CANADA STOCKS-TSX advances as investors assess Trump's push for Greenland talks

By Utkarsh Hathi

Jan 21 (Reuters) - Canada's main stock index on Wednesday bounced back from the previous session's sharp sell-off, as investors digested fresh comments from U.S. President Donald Trump in Davos, Switzerland hinting that he would not use force to acquire Greenland.

The S&P/TSX Composite Index .GSPTSE was up 0.4% at 32,880.61 points as of 10:25 a.m. ET.

The benchmark had recorded its biggest decline since November 20 on Tuesday, when global markets tumbled after Trump threatened to impose tariffs on eight European countries if the U.S. was not allowed to take over Greenland.

The comments revived the "Sell America" narrative, last seen after his sweeping Liberation Day levies in April last year, and raised concerns over a U.S.-Europe trade war.

Speaking at the World Economic Forum in Davos on Wednesday, the U.S. president pushed for immediate negotiations on Greenland, but signaled he would not "use force" to acquire the island.

The energy index .SPTTEN led gains on the TSX, jumping 2.9% to a near 12-year high after losing 1% on Tuesday.

Industrial stocks .GSPTTIN rose 0.6% and the heavyweight financial index .SPTTFS added 0.5%.

While the resources-heavy TSX has benefitted from surging precious metal prices so far this year, the Greenland standoff and Tuesday's sharp drop highlight that Canadian equities are not completely immune to a global risk-off environment.

"Diversification is still very important from a global perspective as well as a sector perspective," said Angelo Kourkafas, senior investment strategist at Edward Jones.

"Volatility will likely be higher in the three months ahead than it has been in the prior three months. But at the same time, it is encouraging and comforting that the foundation for this bull market remains a solid one."

Among individual stocks, Teck Resources TECKb.TO was a standout, rising 6.4% after the copper miner reaffirmed its production outlook for 2026.

Eldorado Gold ELD.TO also gained 4.9% after the gold miner said it had achieved the higher end of its production guidance in the previous year.