US stocks recover half of the prior day's plunge after Trump calls off Greenland-related tariffs

NEW YORK (AP) — The U.S. stock market bounced back from its worst day since October on Wednesday after President Donald Trump said he reached the framework for a deal about Greenland, an island he’s long coveted, and won’t impose tariffs he had threatened on several European countries.

The S&P 500 rallied 1.2% after Trump said the deal, “if consummated, will be a great one for the United States of America” and its allies in the North Atlantic region. The announcement triggered an immediate move higher in the stock market, which found solace earlier in the day after Trump ratcheted down his rhetoric and told business and government leaders in Europe that he would not use force to take “the piece of ice.”

The de-escalation in tensions helped the S&P 500 recover just over half of its 2.1% drop from the day before and pull closer to its all-time high set earlier this month. The Dow Jones Industrial Average jumped 588 points, or 1.2%, and the Nasdaq composite climbed 1.2%.

Treasury yields also eased in the bond market in another signal of reduced worries among investors. Besides the progress on Greenland, they also got help from a calming of yields in Japan’s jumpy bond market. The value of the U.S. dollar, meanwhile, clawed back some of its declines against other currencies after sliding the day before.

Trump himself acknowledged how the U.S. stock market sold off on Tuesday because of his desire for Greenland, but he called it “peanuts compared to what it’s gone up” in the first year of his second term and said it would go up further in the future.

Trump has a history of making big threats that send financial markets sliding, only to pull back later and reach deals that are seen as less bad for the economy or for inflation than his initial suggestion.

On one hand, the pattern has given rise to the “TACO” acronym suggesting “Trump Always Chickens Out” if financial markets react strongly enough. On the other, Trump has ultimately struck deals that outsiders may have earlier considered unlikely, ones that he’s crowed about later. The most obvious example is Trump’s announcement of high tariffs on “Liberation Day,” which eventually led to trade deals with many of the world’s major economies.

Helping to lead the U.S. stock market Wednesday was Halliburton. The oil field services company rose 4.1% after reporting a stronger profit for the latest quarter than analysts expected.

United Airlines climbed 2.2% after likewise reporting a better profit for the final three months of 2025 than analysts expected. CEO Scott Kirby said that the airline’s strong momentum in revenue is continuing into 2026.

They helped offset a 2.2% drop for Netflix. The streamer sank even though it reported a stronger profit than expected. Investors focused instead on its slowing subscriber growth and its lower-than-expected forecast for profit in the current quarter.

Kraft Heinz sank 5.7% after Berkshire Hathaway warned investors that it may be interested in selling its 325 million shares in the food giant that former CEO Warren Buffett helped create in 2015.

Berkshire took a $3.76 billion write-down on its Kraft-Heinz stake last summer. Buffett said last fall that he was disappointed in Kraft Heinz’ plan to split the company in two, and Berkshire’s two representatives resigned from the Kraft board last spring.

All told, the S&P 500 rose 78.76 points to 6,875.62. The Dow Jones Industrial Average climbed 588.64 to 49,077.23, and the Nasdaq composite gained 270.50 to 23,224.82.

In the bond market, the yield on the 10-year Treasury eased to 4.25% from 4.30% late Tuesday. That’s almost all the way back to the 4.24% level where it was at on Friday.

That was before Trump threatened to impose 10% tariffs on Denmark, Norway, Sweden, Germany, France, the United Kingdom, the Netherlands and Finland for opposing U.S. control of Greenland. That would have been on top of a 15% tariff specified by a trade agreement with the European Union that has yet to be ratified.

In stock markets abroad, indexes were mixed in mostly modest movements across Europe and Asia.

Japan’s Nikkei 225 slipped 0.4%.

The country’s prime minister, Sanae Takaichi, has called a snap election for Feb. 8, which had sent yields of long-term government bonds to record levels and raised worries across global financial markets. The expectation is that Takaichi, who is capitalizing on strong public support ratings, will cut taxes and boost spending and increase the government’s already heavy load of debt.

After surging as high as 4.22% on Tuesday, the yield on the 40-year Japanese government bond pulled back to 4.05% Wednesday.

AP Business Writers Chan Ho-him and Matt Ott contributed.

Options trader Chris Dattolo works on the floor of the New York Stock Exchange, Wednesday, Jan. 21, 2026. (AP Photo/Richard Drew)

Specialist Anthony Matesic, left, and trader Edward Curran work on the floor of the New York Stock Exchange, Wednesday, Jan. 21, 2026. (AP Photo/Richard Drew)

Specialist Meric Greenbaum works at his post on the floor of the New York Stock Exchange, as a television shows President Donald Trump speaking at the World Economic Forum, Wednesday, Jan. 21, 2026. (AP Photo/Richard Drew)

Options trader Phil Fracassini works on the floor of the New York Stock Exchange, Tuesday, Jan. 20, 2026. (AP Photo/Richard Drew)

A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Jan. 21, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)

A screen above the trading floor of the New York Stock Exchange displays the closing number for the Dow Jones industrial average, Tuesday, Jan. 20, 2026. (AP Photo/Richard Drew)

People stand in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Jan. 21, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)

A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Jan. 21, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)

A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Jan. 21, 2026, in Tokyo. (AP Photo/Eugene Hoshiko)

PORTLAND, Maine (AP) — The Trump administration is now targeting its mass deportation campaign on Maine, a state with relatively few residents in the United States illegally but a notable presence of African refugees in its largest cities.

The Department of Homeland Security named the operation “Catch of the Day,” an apparent play on Maine’s seafood industry, just as it has done for other enforcement surges, like “Metro Surge” in Minnesota and “Midway Blitz” in Chicago.

Reports of a surge in immigration arrests have struck fear in immigrant communities of Portland and Lewiston and prompted backlash from Gov. Janet Mills and other Democrats, including a refusal to help ICE agents obscure the identity of their vehicles by issuing undercover license plates.

Citizens have formed networks to alert neighborhoods to the presence of ICE agents and bring food to immigrants in their homes, and Portland's superintendent said the school district is developing an online learning plan for its students — more than half of whom aren't white. Many businesses have posted signs saying ICE agents aren't welcome.

“While we respect the law, we challenge the need for a paramilitary approach,” Portland Mayor Mark Dion said Wednesday at a news conference where he was joined by other local officials. “This council doesn’t stand apart from our immigrant communities, we stand with them.”

Portland and Lewiston have thousands of residents of African descent, including many from Somalia.

Somali immigration into Maine accelerated in the early 2000s, and the state now has one of the highest percentages of Somali residents in the country. Immigrants and asylum seekers from other countries followed.

Now the presence of Immigration and Customs Enforcement agents is causing great anxiety in Portland, said city council member Pious Ali, a native of Ghana.

“Our schools have seen about a quarter of immigrants not showing up,” Ali said, and many fear going to work as well: “There are immigrants who live here who work in our hospitals, they work in our schools, they work in our hotels, they are part of the economic engine of our community.”

ICE agents don't need to spread trauma by smashing doors and windows, he said: "The federal government has the ability to contact these people without unleashing fear into our communities.”

The enforcement action is arriving in Maine, a mostly rural state with about 1.4 million residents, as confrontations between ICE and demonstrators continue in Minnesota, where ICE is under scrutiny following an agent’s fatal shooting of Renee Good.

ICE didn’t respond to a request for comment Wednesday on the agency’s plans for Maine, where U.S. Department of Homeland Security said in a statement that increased enforcement began on Tuesday. “We have approximately 1,400 targets here in Maine,” Patricia Hyde, the ICE deputy assistant director, told Fox News.

“We have launched Operation Catch of the Day to target the worst of the worst criminal illegal aliens in the state. On the first day of operations, we arrested illegal aliens convicted of aggravated assault, false imprisonment, and endangering the welfare of a child,” said Homeland Security Assistant Secretary Tricia McLaughlin in a statement.

Secretary of State Shenna Bellows, a longtime opponent of President Donald Trump, said state officials received a request from U.S. Customs and Border Protection for confidential, undercover Maine license plates and decided against issuing them. The licenses plates are used on unmarked vehicles and Bellows said she wants more assurance they will be used appropriately.

ICE’s use of license plates in other states has raised concerns: Illinois Secretary of State Alexi Giannoulias, a Democrat, issued a warning to ICE agents last year that swapping or altering license plates is illegal.

“These requests in light of rumors of ICE deployment to Maine and abuses of power in Minnesota and elsewhere raise concerns. We have not revoked existing plates but have paused issuance of new plates. We want to be assured that Maine plates will not be used for lawless purposes,” Bellows said.

Bellows has run afoul of Trump and his administration before. In 2023, she sought to remove his presidential candidacy from the state’s ballot, arguing that Trump had engaged in insurrection in violation of the 14th Amendment. More recently, she has refused to hand over the state’s voter rolls to the federal government.

Customs and Border Protection did not respond to a request seeking comment, but a top Maine Republican said withholding the undercover plates would jeopardize public safety.

“That really, one, puts us at odds as a state. Puts us at one end of an extreme that we really shouldn’t be on,” Senate Leader Trey Stewart said.

Maine’s top federal prosecutor, U.S. Attorney Andrew Benson joined Democrats in calling for any demonstrations in the state to remain peaceful and civil. Benson, a Trump appointee, warned people to stay out of the agents' way or be prosecuted.

Gov. Mills has pushed back, as have mayors, school district leaders and numerous community organizations. Mills said aggressive enforcement actions that undermine civil rights are “not welcome.”

Lewiston Mayor Carl Sheline said ICE enforcement has been causing “anxiety, fear or uncertainty” for many.

“There is no evidence of unchecked criminal activity in our community requiring a disproportionate presence of federal agents,” Dion said.

Portland Public Schools, the largest and most diverse school district in the state, said in a statement Wednesday that it conducted a “lockout” at two schools to prevent anyone from entering the building during the school day Tuesday because of concerns about ICE activity nearby.

“It was quickly determined that there was no threat to our school communities and the lockouts were lifted within minutes. This is an understandably tense time in our community, as reports and rumors of immigration enforcement actions grow,” the district's statement said.

Maine Democrats have condemned the ICE activity.

“The Trump administration has deployed ICE agents to Portland, Lewiston, and possibly other Maine communities. This is not about public safety. It is about fear, control, and political theater,” Devon Murphy-Anderson, executive director of the Maine Democratic Party, said in a statement Wednesday.

Mayor Mark Dion speaks at a news conference about ICE activity Wednesday, Jan. 21, 2026, in Portland, Maine. (AP Photo/Patrick Whittle)

FILE - Democratic Gov. Janet Mills delivers her State of the State address, Jan. 30, 2024, at the State House in Augusta, Maine. (AP Photo/Robert F. Bukaty, File)

FILE - Buildings on the working waterfront catch the early morning light, Feb. 26, 2025, in Portland, Maine. (AP Photo/Robert F. Bukaty, File)