US stocks rebound as Trump rules out force over Greenland at Davos

US stock markets recovered sharply on Wednesday after President Donald Trump ruled out using force to take Greenland, easing worries that had dragged indices lower in the previous session. The shift in tone helped restore risk appetite, with major benchmarks erasing a large part of Tuesday's losses.

The S&P 500 advanced 1.1% by the middle of the trading session, offsetting much of the prior day's 2.1% fall and moving back towards the record peak reached earlier in the month. Gains were broad-based as investors reassessed geopolitical risks and tariff threats following Trump's latest remarks.

Trump delivered the comments during a session with business and government representatives at the World Economic Forum in Davos, where he said he would not employ military means to obtain what he called "the piece of ice." The statement was interpreted as a clear signal against any armed move over Greenland.

Markets had been unsettled after earlier threats from Trump about potential tariffs on Europe, linked to resistance over transferring Greenland, an autonomous territory under Denmark, to United States authority. While repeating interest in making Greenland part of the United States, Trump stressed that any effort would rely on "immediate negotiations" instead of forceful action.

Earlier in the day, US stock futures were in negative territory, extending the sharp sell-off from Tuesday, until traders judged Trump's change in tone as a step toward de-escalation. Sentiment then improved, lifting equity prices across sectors and pulling key indices firmly into positive territory.

Wall Street opened higher following the remarks. Early trades showed the Dow Jones Industrial Average up 0.4% at 48,697.73, the S&P 500 higher by 0.3% at 6,819.92, and the Nasdaq Composite rising 0.2% to 22,988.96. Buying momentum strengthened as the morning progressed.

Index	Move in early trade	Level
Dow Jones Industrial Average	+0.4%	48,697.73
S&P 500	+0.3%	6,819.92
Nasdaq Composite	+0.2%	22,988.96

By late morning, the advance had widened, with the Dow up around 477 points, or roughly 1%, while the Nasdaq gained 1.3%. The performance pointed to broad participation across industries as investors placed less weight on immediate geopolitical escalation around Greenland.

US stock market, bonds and dollar as risk appetite stabilises

Movements in government bonds also reflected calmer sentiment. US Treasury yields slipped after climbing on Tuesday, when the prior rise had indicated investor concern about long-term inflation and policy uncertainty. The moderation in yields followed more settled trading in Japanese government bonds, which had surged on fears over growing debt in the world's third-largest economy.

The US dollar stabilised against currencies such as the euro and Swiss franc after weakening during the previous session. The steadier performance suggested reduced demand for traditional safe-haven assets, as market participants reassessed the likelihood of immediate trade or geopolitical shocks linked to Greenland.

Trump acknowledged that his own Greenland-related comments contributed to the earlier market decline but played down the impact, describing the drop as "peanuts" when compared with the gains achieved during the first year of his second term. Trump also expressed confidence that markets would climb further over the coming period, reinforcing the more reassuring message that underpinned Wednesday's rebound.