Investors returned from Martin Luther King Jr. Day to plenty of drama on Wall Street. President Donald Trump kicked off the holiday-shortened week with tariff threats on countries that opposed the sale of Greenland, sending the Dow Jones Industrial Average (DJI), Nasdaq Composite (IXIC), and S&P 500 Index (SPX) to their worst session since October. Trump quickly changed course at the World Economic Forum in Davos, where he noted he would not use force to acquire Greenland and abandoned tariff threats, citing the "framework of a future deal with respect to Greenland.”
Stocks bounced as Trump softened his tariff rhetoric, with Danish Prime Minister Mette Frederiksen noting sovereignty negotiations were off the table, though that she was open to talks with the U.S. Stocks were mixed to close out the week, however, on the heels of manufacturing and services data that was below expectations. As of Friday afternoon, the SPX and DJI were on track for weekly losses.
Tough Earnings Week
The earnings confessional was busy this week. 3M (MMM) stock brushed off a fourth-quarter earnings and revenue beat due to lackluster full-year profit forecast, with Netflix (NFLX) shares also plunging amid margin and buyout concerns. GE Aerospace (GE) and Intel (INTC) shares suffered a post-earnings tumbles as well, with Capital One Financial (COF) suffering a similar fate after reporting a revenue miss and plans to acquire startup Brex for $5.15 billion.
Mining in Focus as Gold Shines
Trade and geopolitical tensions placed precious metals and rare earths in focus. MP Materials (MP) and USA Rare Earth (USAR) shares moved higher amid Trump's tariff threats related to Greenland, and copper miner Freeport-McMoRan (FCX) stock rallied before it earnings report. Gold was also in the spotlight as prices nabbed more record highs, with options bulls piling on exchange-traded fund (ETF) SPDR Gold Trust (GLD) as demand for safe-haven asset soared.
Interest Rate Decision Due Out Next Week
The Federal Reserve will deliver its interest rate decision next week, with a deluge of big-name earnings reports also on tap. Among the most mot notable names reporting are American Airlines (AAL), Boeing (BA), Chevron (CVX), Dow (DOW), Exxon Mobil (XOM), IBM (IBM), JetBlue Airways (JBLU), Meta Platforms (META), Microsoft (MSFT), RTX (RTX), Tesla (TSLA), and Western Digital (WDC). If you would like to prepare for what's ahead, dig into historical Dow performance as it approaches round numbers.
