Why Has The Stock Market Gone Up So Much Under Trump?
President Trump is disliked by at least half of the country and it seems like it could be an even higher percentage than that with all the media bashing we see on a daily basis. Trump is everywhere in the news, all the time, and it is almost impossible to go a day without hearing his name in some negative light.
But Wall Street and stocks have soared since his election win and made most investors a lot of money. So how can Trump be hated by such a vocal part of the country who says he is the worst President ever and yet we see the stock market performing on all cylinders at an all time high? What gives?
There are several reasons investors and the stock market love Trump and none of them have to do with any of his social policies, regulations he tries to pass or get rid of, or his ever present opinions he disperses via Twitter. Instead, they all have to do with the economy and the his pro business views.
1) Trump is a business man and not a career politician. What he does and says always ALWAYS seems to be pro business and that is something investors love. It gives them confidence that for the remainder of his term, the economy will do well and businesses will thrive.
2) Most new Presidents come into office with a list of new regulations they want to get passed. Trump was the opposite – he has hardly proposed any new regulations and has done away with many old ones. He campaigned on getting rid of the overabundance of red tape everyone faces in 2017 and that means less expenses and higher profits for American businesses big and small.
3) While America seems to be in chaos when you watch the news, the fact may be that there is less chaos here than in other countries. Economic policy uncertainty is higher in Europe and China and that means more investors are willing to put their money in US corporations.
4) The US dollar has weakened this year and that means that sales made in foreign countries translate back to more dollars. Since business in foreign countries is near an all time high for US companies, the weaker dollar means higher profits.
5) Most economies of the world are doing fine and that means the stock market has an upward bias. Generally, a rising tide raises all boats in the business world.
So, Wall Street doesn’t care whether you love or hate President Trump. All it cares about is how the economy is doing, whether it will do well in the future, and whether the policies being talked about and put in place in Washington will hurt or help businesses. So far, the stock market likes what it sees.
