Stocks Rally After Trump Backs Off Tariff Threat
Stocks rose for the second consecutive day as President Trump withdrew his proposal for a 10% tariff on eight European nations concerning Greenland. The recovery followed concerns that the U.S. might pursue territorial claims over the Danish territory but shifted towards an agreement allowing small U.S. military installations on the island. This rally comes after the S&P 500 index fell nearly 2% earlier in the week due to the initial threats.
Investors have leveraged previous instances of such volatility, often referred to as “TACO”—Trump Always Chickens Out—whereby they buy stocks after market declines stemming from Trump’s trade negotiations. Historical patterns suggest a potential recovery following similar announcements, reflecting a notable investor strategy amidst ongoing tariff uncertainties.
