Gold and silver prices surged, with silver hitting a new record high, while stock markets slid after European countries said they “stand united” against Trump’s weekend vow to hit them with tariffs of up to 25% unless Greenland is ceded to the United States.
“Gold surged to a record high and stocks wobbled as fresh worries about Greenland surfaced,” noted Neil Wilson, investor strategist at Saxo UK.
Gold has broken record after record in recent months as the precious commodity, along with sister metal silver, benefits from safe-haven status.
Gold traded around 1.6% higher at the end of the European trading day, while silver rose by more than four percent, having set a new record high.
Market jitters got worse after the US Treasury chief said Monday that any retaliatory EU tariffs on the US would be “unwise”.
Experts said investors were finding it difficult to absorb what Ipek Ozkardeskaya, senior analyst at Swissquote, called a constant stream of “abnormal” news surrounding the Trump’s campaign to take over Greenland.
“I lose my words in the absurdity of the news flow,” she said.
Wall Street was shut for Martin Luther King Day, but there was much selling in Europe’s equity markets as the mood turned risk-averse.
The luxury and auto sectors were hit hard by Trump’s threats, with the share prices of LVMH dropping by close to 5%, and that of BMW by nearly 4%.
But some defence stocks climbed, with Germany’s Rheinmetall up by more than one percent.
The IMF on Monday upgraded its 2026 global growth forecast, citing a boost from tech investments but warning that a reevaluation of AI productivity gains or renewed trade tensions could bring disruptions.
World economic growth is projected to hold steady at 3.3% this year, it said.
This would match the pace of growth in 2025.
China’s economy grew at one of the slowest rates in decades last year, official data revealed Monday, as authorities struggled to overcome low consumer spending and a debt crisis in the property sector.
Chinese stocks closed mixed at the start of the new trading week.