Trump's latest tariffs U-turn is sparking a global market rally — and reviving talk of the 'TACO trade' MSN Chloe Taylor U.S President Donald Trump's latest retreat from a trade war has catalyzed an international asset rally — and revived investors' talk of "TACO" — "Trump Always Chickens Out." Speaking to CNBC's Joe Kernen at the World Economic Forum in Davos, Switzerland, on Wednesday evening, Trump said he'd walked back tariffs on European allies because he now had "the concept of a deal" over Greenland, after weeks of demanding to annex it for the U.S. He had threatened to impose 10% tariffs on eight European countries that opposed his push to "buy" the Arctic island. They would have risen to 25% from June 1. But Wall Street's major averages jumped after Trump's walk-back on Wednesday, with stock futures pointing to an extension of those gains on Thursday morning. The rebound rippled globally, with equities listed in Europe and Asia also rising when regional markets reopened Thursday......read more
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Return of the TACO trade?

Amid the global rally, one of the key fixtures of investing in 2025 stepped into the new year: the "TACO" trade. The phrase refers to the president's history of threatening to leverage intense levies, only to ease, delay or cancel them. It was coined last year after Trump's "liberation day" announcement of tariffs in April shocked markets but investors grew skeptical of his follow-through when he eventually backed down. Market reactions to subsequent U.S. trade policy announcements were more muted or saw recoveries more quickly. Russ Mould, investment director at AJ Bell, likened today's market moves to those seen last year. "Donald Trump's TACO bell has rung once again, much to the joy of financial markets," he said in a Thursday morning note. "Trump has form in chickening out of his threats … there are a lot of similarities with the liberation day market wobble in April 2025 and now. "In both situations, Trump took an aggressive stance and then backed down after financial markets wobbled."  https://www.msn.com/en-us/money/markets/trump-s-latest-tariffs-u-turn-is-sparking-a-global-market-rally-and-reviving-talk-of-the-taco-trade/ar-AA1UJqSI?cvid=69728c347ffe4d35a3dbc8d313dddb8e&ocid=UP97DHP