Global stocks were strong after news that the U.S. administration had reached a deal on Greenland last week, catching investors by surprise.
UK 100 – Daily Chart
The UK 100 index surged by more than 0.75% on Thursday, with the all-time high only around 50 points away. However, the index gave up those gains and was mixed on Friday. That shows underlying caution in British stocks.
The news of an agreement on Greenland ended fears of a situation that could’ve dragged on and led to further hostility and market tensions. For the UK and other European nations, it also ended the threat of stiff tariffs on exports to the United States.
That could’ve tipped the country into a harsh recession, but a decline is already expected for next year and stock market investors are ignoring that fact as stocks push toward another all-time high.
Meanwhile, a recent survey of business owners found that 25% expect a downturn next year, up from 13% last year. Around 38% expect economic growth, but that is a sharp decline from 61% next year, the PwC Global CEO Survey said.
Under the terms of the Greenland deal, the U.S. is expected to gain small parts of the island nation in order to build military bases. The move could also ease tensions between Trump and NATO.
Stocks may get some respite from geopolitical stress, but the President is still damaging the country’s stability. Investors may be wondering what will be required next, amid the threat of trade tariffs after a two-week period that has seen regime change in Venezuela and threats against Iran.
