USA Today reports as the Dow surges individual stock results are mixed.
The Dow surged as much as 180 points and blasted to new record highs in early trading Thursday after Asian markets soared overnight as investors were hopeful for a Day 2 of the “Trump Bounce” and fears related to Donald Trump’s stunning election win gives way to hopes that the president-elect’s policies could boost the economy.
But the early rally faded slightly and broader stock indexes turned lower as tech stocks took a hit.The initial post-election rally has been driven by investors reassessing their views on a Trump presidency and beginning to focus on the growth-friendly positives for the economy, such as fiscal spending, lower taxes and less regulation of businesses under Trump.
In general, Wall Street is shifting its focus from Trump, the man and presidential campaigner, to Trump’s policies.
The fact that Republican retained control of both houses of congress bodes well for many of Trump’s stated policies. Others may have problems. The Tea Party conservatives want to cut spending and rein in debt. That aspiration is at odds with Trump’s desire to cut taxes while at the same time enacting a huge infrastructure revitalization program. Thus the Trump Victory Leads to chaotic stock trading.
Everyone Agreed on an Infrastructure Fix
The New York Times says that infrastructure is what Trump, Clinton and voters agreed on.
At the end of a stunning and divisive election that left many Americans feeling further apart than ever, there was perhaps one area of common ground: infrastructure.
In a triumphant victory speech early Wednesday, President-elect Donald J. Trump cited the issue as a top priority for his administration.“We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals,” Mr. Trump said. “We’re going to rebuild our infrastructure, which will become, by the way, second to none.”
During the presidential campaign, Mr. Trump pledged to spend nearly $1 trillion on infrastructure, seeking to outshine Hillary Clinton on an issue that is a growing concern for many Americans.
If this is what Trump follows through on and browbeats the congressional Republicans into supporting it will be clear focus for traders and investors. Nevertheless, this situation with the President and both houses of congress being of one party is reminiscent of 1976 when Carter took office. What followed was substantial bickering between Democrats and the loss of the White House four years later. That sort of situation would lead to continued chaotic stock trading as Trump and the various Republicans factions attempt to assert their individual agendas to the exclusion of the others. It should be no surprise that Warren Buffett has the largest cash position he has ever had as a protection against market chaos.
