US stocks edged higher on Wednesday, recovering part of the losses from the sharpest market selloff in nearly three months, as investors weighed President Donald Trump’s comments at the World Economic Forum in Davos, including renewed remarks about acquiring Greenland.
Speaking to global leaders in Switzerland, Trump said the United States was best placed to guarantee Greenland’s security. He added that he would not use force to take control of the territory and called for immediate talks aimed at reaching a deal with Denmark, easing some investor concerns.
Markets remained cautious after Tuesday’s steep decline, when the Dow Jones, S&P 500, and Nasdaq each fell close to 2 percent. The selloff followed Trump’s warning that new tariffs could be imposed on European allies if the US is not allowed to purchase Greenland, an autonomous territory under Danish control.
Art Hogan, chief market strategist at B Riley Wealth, said the reassurance about avoiding the use of force helped stabilise markets. However, he noted that investors remain concerned about the risk of renewed trade tensions. Reflecting the calmer mood, the CBOE Volatility Index fell by 1.22 points to 18.87 after touching its highest level since mid-November in the previous session. Shares of major technology firms showed modest gains, with Nvidia and Tesla rising 0.4 percent each after being among the hardest hit in Tuesday’s selloff.
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