Global Markets Drop Amid Security Concerns in Greenland and Japan

Global financial markets registered sharp declines on January 20, 2026, triggered by a surge in geopolitical risk following the deployment of Danish military personnel at the Nuuk port on January 18. The move, described by defense officials as a routine security reinforcement, sparked speculation about increased foreign presence in the Arctic region, prompting investor caution. In parallel, Japanese authorities reported an unexplained power fluctuation affecting 12 regional substations, impacting 1.8 million households before restoration began late on January 19. The S&P 500 closed down 2.4%, marking its steepest single-day drop since August 2024, with technology and energy sectors leading losses. The Nasdaq Composite fell 2.8%, dragged down by semiconductor stocks averaging a 3.5% decline. Meanwhile, Japan’s Nikkei 225 plunged 3.1%, with industrial and utilities shares dropping more than 5%. Bond yields rose across the board, with the 10-year U.S. Treasury yield climbing to 4.78%—its highest level since October 2024—as investors fled toward safe-haven assets. Market participants cited growing concerns over supply chain resilience, particularly for rare earth materials sourced through Nordic and East Asian routes. Analysts noted that Greenland’s potential mineral wealth has drawn interest from multiple countries, increasing the strategic sensitivity of recent troop movements. Simultaneously, Japan’s infrastructure vulnerability emerged as a focal point, with regulators confirming that no cyberattack was detected but raising questions about aging grid systems. The combined impact led to a 1.9% drop in global equity futures and a rally in gold prices, which reached $2,147 per ounce—the highest since June 2023. Currency markets also reacted, with the yen weakening 1.7% against the dollar amid fears of capital outflows from Japan’s domestic markets.