March 28, 2017
After Election Day, the stock market priced in four years of a Donald Trump presidency in less than four months of trading. On Nov. 7, the Dow Jones Industrial Average briefly fell below 18,000 intraday. By March 2, the benchmark index had topped 21,100 — an impressive 17 percent gain.
But ever since the beginning of March, policy missteps and continued scandals have started to weigh on the Trump administration — and the rally. The Dow just posted its longest losing streak in six years as the mood in both Washington and on Wall Street has soured.
So it’s worth asking: Is this the end of the Trump rally? The short answer, in my opinion as a stock market analyst, is “yes.” But the longer answer is that it was never Trump’s rally to begin with, and it may not really be his fault that stocks are in store for a difficult 2017, either. Investors have been fretting about the risk of declines for some time, and the recent narrative of a Republican Congress that can’t deliver may simply be a convenient excuse for an overdue selloff.
Consider for starters that we are in the midst of an eight-year run for stocks. That is not to say that we haven’t had a few bumps along the way, of course, such as a roughly 10 percent decline for the major indices in late summer 2015 on global growth concerns. But as it has so many times since the Great Recession, the stock market stabilized quickly and resumed its run higher.
This article was posted: Tuesday, March 28, 2017 at 8:11 am