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A handful of Greenland-linked stocks have surged as President Donald Trump’s threat to take control of the Danish territory sparks a wave of interest in companies exposed to its economy.
Shares in Copenhagen-listed Grønlandsbanken, Greenland’s biggest bank, have jumped 33 per cent so far this week as Trump has repeatedly insisted that the US must “have” Greenland, which is rich in natural resources.
US-listed Critical Metals, which is digging across south Greenland for rare metals including tantalum, niobium and gallium, has climbed 108 per cent this year. Føroya Banki, another lender with operations in Greenland, is trading at an all-time high having gained 30 per cent since mid-November.
The sharp moves have come as the Trump administration has intensified its threats to use military action to acquire the island of 57,000 people, sparking protestations from Copenhagen and EU officials that such an attack would spell the de facto end of the post-second world war western alliance.
Analysts struggled to explain the immediate rationale for investing in Greenland-exposed stocks, and said their share price gains over recent weeks bore the hallmarks of a meme stock rally driven by retail investors.
“I would attribute this to retail,” said Mike O’Rourke at Jones Trading. “I can’t say definitively that there aren’t institutional investors in the trade buying based on headlines, but it makes sense that meme traders are excited by certain things we’re seeing, including Greenland.”
Some market participants said a deal where the US buys all or parts of Greenland and invests in the domestic economy could lift local finance providers and other companies.
“The trade does have some logic if the expectation is that a US takeover would invigorate the local economy,” said Arun Sai, a senior multi-asset strategist at Pictet Asset Management.
Retail traders have become a significant force in global stock markets in recent years, using popular forums including Reddit’s WallStreetBets to synchronise trading strategies and commission-free trading platforms to chase trends.
The seizure by US special forces of Venezuelan leader Nicolás Maduro over the weekend has also captured the attention of small investors, as well as Wall Street companies seeking to capitalise on their voracious appetite for risky bets.
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Exchange traded fund provider Teucrium this week filed an application with US regulators to list a “Venezuela Exposure ETF” that will track companies deriving half or more of their revenue from goods or services made in the South American nation.
Shares in US energy majors have, meanwhile, gained ground on Trump’s plans to export Venezuela’s vast oil reserves to the US.
Analysts at Vanda, which monitors retail trading flows, said buying by amateur investors had over the past week “accelerated across several major energy stocks” including Chevron and Halliburton. Vanda also said there had been a sharp rise in retail buying of Critical Metals’ shares this week.
Additional reporting by Richard Milne and Rachel Rees