It has been a little over a month since President Trump returned to office for his second term. In these few weeks, the commander in chief has laid the groundwork for this new administration through a flurry of executive orders, tariffs, and changes to the shape of the federal government thanks to Elon Musk and the Department of Government Efficiency, among others. With the tax cut bill getting approved by the House earlier this week, tariff implementation starting in the next few weeks, and DOGE working to cut $1T in savings, how is the market reacting? We get into it.
This week on Capitol Gains, anchor Madison Mills and Senior Columnist Rick Newman talk about the latest coming from Washington D.C. and how the market has responded since President Trump returned to the White House.
“The market is incredibly obsessed with corporate tax cuts, particularly because year to date we’ve seen a lack of strong conviction in the market, and earnings estimates are moving sideways,” Mills says. “This idea that earnings from companies - we’ve gotten used to them just growing so exponentially - and now we’re just getting your average run-of-the-mill beats when it comes to earnings.”
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Newman takes a more broad approach to the subject at hand. “The overall stock market has not gone up since Trump took office. There was a little bit of a rise after the election, but the S&P 500 has basically flatlined,” Newman says. “What seems to be going on is Trump is giving markets all the bad news first, which is tariffs, deporting migrant workers, and whatever DOGE is up to. We’re getting all the bad stuff now and what markets want, what’s going to be the upward trajectory stuff, is tax cuts and deregulation.”
To learn more, listen to the full episode of Capitol Gains here.
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Capitol Gains is Yahoo Finance’s unique look at how US government policy will impact your bottom line long after the Presidential election polls have closed.
This post was written by Lauren Pokedoff.