The stock exchange's large-cap index OMXS30, which rose 0.5 percent, was led by the private equity firm EQT, which rose 3.8 percent. Investment firm Investor also rose 0.6 percent after its report.
The upturn was broad: 24 of 30 shares in OMXS30 closed in the green. Against the tide, the tissue company Essity fell 7.4 percent.
Even on Wall Street, arrows were pointing upwards in early trading.
"It's a very big sigh of relief," says Robert Bergqvist, economist at major bank SEB.
Trump speech in Davos
The gains came after US President Donald Trump toned down his rhetoric regarding Greenland on Wednesday, including in his speech in Davos.
"It was a complete turnaround. He took a few steps back, not least when it comes to using military means. But it is also important that he backs down from tariffs for the time being," says Bergqvist.
The fact that both geopolitical and trade policy risks have decreased is what the stock markets are reacting positively to.
"The stakes in this trade war were extremely high - they were starting to lay claim to other countries," says Bergqvist.
However, he emphasizes that no one seems to know exactly what could be included in a possible agreement on Greenland and that many analysts are still trying to interpret the situation.
"In recent days, there has been this growing anxiety and a knot in the stomach about where this is going. Now it seems like we are going backwards after all."
"But we are dealing with Trump after all, so the uncertainty will remain."
Modified message
According to Robert Bergqvist, it is clear that Donald Trump is not immune to what is happening on the stock market and with interest rates and the dollar.
"He modifies his messages and takes steps back. It is a given conclusion, confirmed again, that he is reacting to market reactions."
He also thinks there is a common thread in Trump's actions regarding rare earth metals, even though he said in his speech that the claim to Greenland is not about them but about security.
"He still mentions that it could be included in an agreement. I think you can take from that that for him it is extremely important to ensure the US will have access to rare earth metals in the future."
With Thursday's rise, the Stockholm Stock Exchange has risen 2.5 percent since the turn of the year.
