UK and European markets moved lower on Monday following a renewed threat from U.S. President Donald Trump to impose tariffs of up to 25% on eight European countries over Greenland.
Chancellor Rachel Reeves withdrew from a scheduled appearance at the London Stock Exchange, where she had been due to mark what organisers described as a “new golden age” for the City, after Trump said tariffs would remain in place until the United States is permitted to buy Greenland.
Her decision came as markets opened weaker, undermining the celebratory tone of the event, which had been planned after the FTSE 100 climbed above the 10,000 level for the first time.
UK equities opened in the red, with the FTSE 100 down 0.4%, following losses across Asian markets overnight as investors shifted toward safe-haven assets such as gold and silver.
Elsewhere in Europe, France’s CAC 40 fell 1.6%, Germany’s DAX dropped 1.4% and Spain’s IBEX 35 slid close to 1% in early trading.
The Treasury confirmed that Reeves would not attend the Stock Exchange event in the City. Instead, she appeared alongside Prime Minister Keir Starmer at a Downing Street press conference on Monday morning. Starmer said the dispute with Trump’s administration over Greenland should be addressed through “calm discussion between allies”.
Proceedings at the exchange went ahead without the chancellor, led by LSE chief executive Julia Hoggett, with ticker tape released as trading began.
Trump said on Saturday that he was prepared to introduce tariffs of up to 25% on goods from Denmark, Germany, France, the Netherlands, Finland, Sweden, Norway and the UK until the U.S. is allowed to acquire Greenland.
He added that an initial 10% tariff would take effect from 1 February “on any and all goods sent to the United States of America”, with the rate rising to 25% on 1 June.
“There will be hundreds of different opinions on how this will all pan out but remember that the tariffs announced on ‘liberation day’ were ultimately softened a week later,” said analysts at Deutsche Bank. “That said, as it stands the tariff threats are real, and would be economically and geopolitically damaging.”
U.S. financial markets are closed on Monday for Martin Luther King Jr Day.
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