European stocks slid on Monday as Trump’s Greenland tariff threat rattled investors.
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The Swiss stock market opened lower on Monday, like other European markets, as investors digested the escalation of geopolitical tensions over Greenland and the threat of new US tariffs on eight European nations. Safe haven investments like the Swiss franc benefited against this turbulent backdrop.
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US President Donald Trump has vowed to slap tariffs on eight European nations until the US is allowed to buy Greenland.
Trump says he will impose an additional 10% import tariffs
from February 1 on goods from Denmark, Norway, Sweden, France,
Germany, the Netherlands, Finland and Britain, which will rise
to 25% on June 1 if no deal is reached.
On Saturday, Trump accused the European countries of playing “a very dangerous game” in Greenland.
Reacting to these comments, French President Emmanuel Macron plans to ask Brussels to activate the EU’s anti-coercion instrument in the event of new US tariffs, a tool that can be used to limit imports from a country and block certain investments.
“The market is beginning to take on board a new parameter: tariffs are no longer just an economic tool, but a direct diplomatic weapon,” said John Plassard, head of investment strategy at Cité Gestion.
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For Ipek Ozkardeskaya, an analyst at Swissquote, “the fundamentals for a major downward movement are being put in place”.
Amid these latest tensions, and ahead of Trump’s visit to the World Economic Forum (WEF) annual meeting in Davos on Wednesday, safe haven investments are in demand. Gold and silver have reached new highs and the Swiss franc has strengthened against the dollar.
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Greenland emerges as new source of Swiss gold imports
Richemont suffering
On the Swiss stock exchange at around 9am, the leading SMI index was down 0.88% at 13,294.70 points, having ended Friday down 0.47%. The SLI gave up 1.10% to 2149.78 points and the SPI lost 0.91% to 18,359.92 points.
Almost all the leading stocks started the day in the red, with the exception of Swisscom (+0.4%), Novartis (+0.2%) and Givaudan (+0.03%).
The biggest losers were Julius Bär (-3.6%), Richemont (-3.0%) and VAT Group (-3.0%). The luxury giant is particularly exposed to the United States.
Translated from French by AI/sb
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