“This is Biden’s Stock Market, not Trump’s,” according to US president Donald Trump.
Last year Donald Trump claimed credit for the soaring stock market, saying investors were pricing in a Trump victory in November.
With things now trickier – stocks are off to the worst presidential-term start since 1974 – he’s blaming it all on Joe Biden.
Ridiculous? Yes, but for investors, there is a bright side to Trump’s protestations: they confirm he still treats the stock market as a key scorecard. If he didn’t care, he wouldn’t desperately seek excuses.
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Faith in the Trump Put – the idea he would adjust policy if investors took fright – was shaken when he doubled down on tariff threats despite a sharp sell-off in financial markets.
However, markets were reassured when Trump eventually blinked, and the recovery has been strong.
The S&P 500 has erased losses seen since April 2nd’s Liberation Day, as he dubbed it. Other measures of risk appetite have also returned to pre-tariff levels.
Indeed, while stocks initially fell on Wednesday on news of a first-quarter GDP contraction, indices finished the day higher, suggesting investors were looking past the data and betting on better days ahead.
Complacency? Perhaps, but for now, markets again believe Trump won’t let them fall too far
