Trump Effect has sent the index up over 1,200 points in the four weeks since Trump’s shocking defeat of Hillary Clinton. On Wednesday, a burst of buying has sent the Dow surging nearly 300 points to new all-time highs.
Before the election, so called stock pickers warned the Dow would plunge 1,000 points if Donald Trump was elected. In reality, they were WRONG! Just like 99% of polls were wrong on Trump election win. We better just listen to opposite these people say!
CNN MONEY REPORTS
Wall Street is betting that Trump will be great for business and help accelerate the U.S. economy. Trump has promised to slash taxes, roll back costly regulations and spend big on infrastructure.
Neil Hennessy, president of mutual fund Hennessy Funds, believes more good times are coming and the Dow will soon eclipse 20,000.
“If you’re not in equities, you’re crazy,” Hennessy said. He predicted more cash will flow into stocks as Americans realize how much bonds have tanked since the election, a trend he expects will continue. Bonds have struggled badly due to higher growth and government spending forecasts under Trump.
The U.S. stock market has greeted Trump much more warmly than it welcomed President Obama. During the same period after Obama’s 2008 victory, the Dow had fallen 1,000 points. Of course, during much of Obama’s term stocks have rallied: the Dow has gained close to 10,000 points since he was elected.
Not even Trump himself has been able to stop the post-election euphoria on Wall Street. Trump put the pharmaceutical industry on notice on Wednesday, warning he will lower controversial drug prices. The comments, in an interview with Time, spooked biotech stocks, but had little impact on the rest of the market.
Likewise, stocks rose on Tuesday even after Trump took a surprisingly strong stance against American aerospace giant Boeing. Trump’s threat to cancel Boeing’s Air Force One contract only caused a brief dip in Boeing’s (BA) stock price and the Dow closed at a record high.
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