uploads///stock trading monitor desk

Has President Trump Lost His Mojo to Lift Markets?


Dec. 12 2018, Updated 11:02 a.m. ET

President Trump

US equity markets rallied sharply in 2016 after President Trump was elected. There was a sharp rally in metal prices. Before President Trump’s election, base metals like copper and aluminum were trading in a narrow range. Copper (FCX) had a hard time going past the $5,500 per metric ton price level.

Along with base metals, we saw a sharp rally in some of the other sectors like steel. President Trump was expected to save US manufacturing, especially steel, from the onslaught of imports. The sharp rally in some stocks after President Trump’s election was famously termed as “Trump trade” by analysts.

Article continues below advertisement

Tax cuts

President Trump’s bonhomie with equity markets (SPY) continued in 2017. The strong US economy and President Trump’s supposedly business-friendly policies, which included cutting back on regulations, helped prop up US equity markets in 2017. The tax cut, which eventually came into effect at the beginning of 2018, also helped equity markets by lowering companies’ tax outgo. Amid all of the business-friendly policies, markets somehow ignored the more controversial aspects like President Trump’s views on the border wall, immigration, and trade.

So far, 2018 has been a different ball game for markets. President Trump’s hardline on trade didn’t sit well with markets. Several companies including Amazon (AMZN), Alphabet (GOOG), and Walmart (WMT) oppose the tariffs on China.

President Trump’s aggressive tweets about trade issues have gotten strong reactions from markets. Some of President Trump’s reconciliatory tweets have gone unnoticed, which we’ll discuss in the next part.


More From Market Realist

  • Man going into a tax preparation office
    Should I File a Tax Extension Before the Tax Deadline?
  • Thai Airways plane
    Thai Airways (TAWNF) Is Risky, Best to Avoid the Penny Stock
  • A "now hiring" sign outside a Popeyes restaurant, one sign that employers are having trouble finding employees willing to work for current wages.
    Why Employers Are Struggling To Fill Jobs Despite High Unemployment
  • Beyond Meat patties in a grocery cart
    Buying the Dip on Beyond Meat (BYND) Stock Is a Risky Move
  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.