London (AFP) – Stocks rallied Thursday after President Donald Trump rowed back on threats to hit key European countries with tariffs over their opposition to a US takeover of Greenland. Gains were fueled also by a surge in tech stocks as the artificial intelligence trade roared back into the spotlight after the head of top AI chipmaker Nvidia said the sector needed “trillions of dollars” more investment.
Markets had been rattled this week by the US president saying he would hammer several nations — including Germany, France, Britain, and Denmark — with levies for their pushback against his grab for Greenland, a Danish autonomous territory. But relief came Wednesday when Trump backed down on threats to seize the North Atlantic island by force from ally Denmark and retracted his tariff threat, following talks with NATO Secretary-General Mark Rutte.
“That was enough to trigger the so-called TACO trade – ‘Trump Always Chickens Out’ – and markets responded with one of their strongest rallies in recent months,” said Fawad Razaqzada, market analyst at Forex.com. But analysts said there was no guarantee that Europe-US relations had improved durably, a concern that capped gains. “The Greenland situation may have calmed down, but there are still enough unanswered questions,” said AJ Bell investment director Russ Mould. “It’s more about financial markets regaining balance than moving into top gear.”
Advances in Asia earlier were led by tech-heavy markets Tokyo, Taipei, and Seoul, with the latter topping 5,000 points for the first time as chip companies enjoyed bumper gains. The surge came after Nvidia boss Jensen Huang told the World Economic Forum in Davos that the infrastructure to develop and power generative AI models will require further “trillions” of dollars in investment. He told delegates that the AI boom “has started the largest infrastructure buildout in human history.” The remarks helped boost South Korean chip leaders Samsung and SK hynix, tech investment giant SoftBank in Japan, and European heavyweights ASML and STMicroelectronics.
Trading in French video game giant Ubisoft was briefly suspended following a 33-percent fall in its share price after the “Assassin’s Creed” maker announced it expected to make huge losses this year.
– Key figures at around 1440 GMT –
New York – Dow: UP 0.9 percent at 49,536.76
New York – S&P 500: UP 0.7 percent at 6,923.62
New York – NASDAQ: UP 0.9 percent at 23,437.99
London – FTSE 100: UP 0.6 percent at 10,193.42
Paris – CAC 40: UP 1.3 percent at 8,169.46
Frankfurt – DAX: UP 1.2 percent at 24,865.86
Tokyo – Nikkei 225: UP 1.7 percent at 53,688.89 (close)
Hong Kong – Hang Seng Index: UP 0.2 percent at 26,629.96 (close)
Shanghai – Composite: UP 0.1 percent at 4,122.58 (close)
Euro/dollar: UP at $1.1716 from $1.1683 on Wednesday
Pound/dollar: UP at $1.3436 from $1.3418
Dollar/yen: UP at 158.62 yen from 158.43 yen
Euro/pound: UP at 87.21 pence from 87.08 pence
Brent North Sea Crude: DOWN 1.2 percent at $64.47 per barrel
West Texas Intermediate: DOWN 1.2 percent at $59.89 per barrel
© 2024 AFP
