New York, Jan 21, 2026, 17:02 EST — After-hours
- Dow surged 588.64 points, reversing Tuesday’s drop sparked by tariff worries
- Trump announced he won’t move forward with Greenland-related tariffs scheduled for Feb. 1, easing concerns among investors
- All eyes are on Thursday’s PCE inflation data and the Fed meeting scheduled for next week
The Dow Jones Industrial Average jumped 588.64 points, or 1.21%, on Wednesday, clawing back much of the previous day’s losses after President Donald Trump announced he would drop plans for Greenland-related tariffs on European allies. Dow futures edged up modestly in after-hours trading. 1
The rebound stood out since Tuesday’s sell-off wasn’t driven by earnings or an unexpected slowdown. Instead, it came down to policy risk sharply rattling prices. Traders scrambled to assess if the next headline would shift the outlook for inflation and interest rates. 2
Markets are bracing for fewer surprises ahead of next week’s Federal Reserve meeting, as investors zero in on the latest data. The Fed is scheduled to meet Jan. 27-28. 3
Trump announced on Truth Social that a “framework” for a future Greenland deal had been agreed upon and confirmed he would not go ahead with the tariffs set to begin Feb. 1. U.S. stocks rallied sharply following his statement, closing near their session highs. 4
“I don’t see who owns Greenland affecting the economy anytime soon,” said Jason Pride, Glenmede’s chief of investment strategy and research. The bigger question, he noted, is “whether we start slapping tariffs on each other.” 4
Tuesday marked the first trading day after a U.S. market holiday, and investors moved quickly to sell. The Dow tumbled 870.74 points, a 1.76% drop, while the CBOE Volatility Index—Wall Street’s so-called “fear gauge”—spiked to its highest level since late November. 2
Jamie Cox, managing partner at Harris Financial Group, said he hasn’t seen investors “fleeing” yet and doesn’t think the Greenland flare-up alone will “precipitate” a wider market correction. 2
On Wednesday, a few heavyweight Dow names did most of the heavy lifting, with Amgen and Nvidia leading the charge as investors favored the index’s pricier stocks. 5
Treasury yields slipped as risk sentiment found footing, lifting stocks that had taken a hit from the recent rise in borrowing costs. The U.S. 10-year Treasury yield hovered near 4.25% by the session’s end. 4
At Davos, Citadel founder Ken Griffin said tariffs have already tangled up long-standing trade relationships. He also warned that pushing the Fed to cut rates could ignite inflation once more. 6
The Greenland “framework” offered few specifics, and traders know tariff talk can flare up fast. On top of that, a hotter-than-expected inflation number might drive yields higher again, putting pressure on stocks—especially if it alters bets on the Fed’s rate path. 4
Thursday brings the personal consumption expenditures price index. This PCE report is the Fed’s favored measure of inflation. Its “core” variant excludes food and energy to better capture underlying price trends. 7
