American Express, Trump steel remarks re-ignite bull market

Positive news on Obamacare “repeal and replace,” potential tax moves, stable oil prices juice stock averages as well. Is irrational exuberance back?

0
530
An American Express promotion in Hong Kong. (Image via Wikipedia article on American Express, CC 3.0 license)

WASHINGTON, April 20, 2017 – The faltering Trump Rally has been in suspended animation for the better part of four to six weeks now, with only an occasional ray of sunshine piercing through the gloom of the aborted Obamacare repeal effort and the increasingly likely delay of greatly-desired U.S. tax reform measures. Wednesday’s gloomy stock market action reinforced the negative mood for most investors.

But what a difference a day makes. After a heavy cloud cover and intermittent rain yesterday here in our vast, mink-lined headquarters just outside Washington, D.C., the sun has come out in all its spring glory Thursday, bringing with it more summery temperatures and a more positive disposition—a brighter attitude that seems to be coloring today’s trading action on Wall Street.

Of course, a pair of early morning surprises from the nation’s capitol helped in this attitude adjustment; namely, word that an allegedly more-agreeable (to heretofore disgruntled House Republicans) Obamacare “repeal and replace” strategy might be back on the table when Congress returns from recess; rumors that Treasury Secretary Mnuchin might have some good words to say about progress toward real tax reform; and President Trump’s announcement that he was directing the Department of Commerce to open an investigation on foreign steel dumping (read “China”) and its potential influence on national security.

American Express’ (symbol: AXP) earlier blowout earnings report didn’t hurt either, goosing that company’s stock over 5 percent to the upside in heavy trading and helping offset recent weakness in the Dow Jones Industrial Average and in the banking sector itself.


As we near the 2 p.m. (ET) mark, the Dow is up an impressive 200 points (nearly 1 percent). The broader-based S&P 500 and the tech-heavy NASDAQ are both up by approximately the same percentage, indicating that a rising tide of comparatively good news, at least for today, can indeed lift all boats.

Imponderables still hang over the market. Crude oil took (WTI at least) took a roughly 5 percent hit to the downside yesterday and is marginally down today, continuing to erode confidence in the energy sector. And, lest we forget, the first phase of the French elections is about to unfold. This is causing many traders to worry that right-leaning, anti-Euro candidate Marine Le Pen might make it into the final runoff.

A win by Le Pen could raise fears of another nightmare scenario for Europe’s reigning socialist-globalist alliance, which was badly battered in 2016 by the Brexit win in the UK and by Donald Trump’s shocking (to the lefties) populist win in the U.S.

At this point, these worries don’t look to derail Thursday’s powerful rally. But second thoughts could trade Friday trading action, as many traders and investors may not want to hang around for those French election results.

Updates later, if warranted. But for now, let’s sit back and enjoy this unusual burst of bullish fun.

Click here for reuse options!
Copyright 2017 Communities Digital News

• The views expressed in this article are those of the author and do not necessarily represent the views of the editors or management of Communities Digital News.

This article is the copyrighted property of the writer and Communities Digital News, LLC. Written permission must be obtained before reprint in online or print media. REPRINTING CONTENT WITHOUT PERMISSION AND/OR PAYMENT IS THEFT AND PUNISHABLE BY LAW.

Correspondingly, Communities Digital News, LLC uses its best efforts to operate in accordance with the Fair Use Doctrine under US Copyright Law and always tries to provide proper attribution. If you have reason to believe that any written material or image has been innocently infringed, please bring it to the immediate attention of CDN via the e-mail address or phone number listed on the Contact page so that it can be resolved expeditiously.

SHARE
Previous article‘Shattered’: New book explains Hillary’s last witch hunt
Next articleTrading Diary: U.S. steel sector does a complete about face
Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17