While it might not amount to “total exoneration,” as Donald Trump put it, it’s hard to argue — though there’s no shortage of people willing to try — that the Mueller report didn’t deliver a big win for the president.
But is it a victory for investors?
So far, the stock market isn’t exactly popping the champagne as Friday’s selling mood seems to be spilling over into early action.
Nevertheless, there are plenty of pundits who believe it’s just a matter of time before the bull shakes off the latest weakness and gets back on track now that at least some uncertainty has been lifted.
The anonymous blogger The Fly, for instance, put it in his own terms.
“Markets will likely favor this news, since Trump is a super easy money dork — who box watches stocks all day and really wants to get a trade deal done — a very beautiful one at that — to establish a legacy of being the best stock market promoter in the history of American politics,” he wrote.
Others, however, were much more measured with their optimism.
“It frees [Trump] up to focus on infrastructure and housing reform,” says Larry McDonald of the Bear Traps Report. “We will rally on this but everything that took us down last week will keep rearing it’s ugly head again.”
Stephen Weiss, founder of Short Hills Capital Partners, agreed that any benefit might be short-lived.
“I think the market was going to bounce back anyway and this gives it a little extra oomph,” he said. “But overall the investigation rarely was a big concern for investors. If there is a big pop on this, you can likely fade it.”
So, popular sentiment among Wall Street types seems to be that, for this Trump stuff to result in any meaningful momentum, other pieces need to fall into place.
In our call of the day, portfolio manager Cam Hui, who writes for the Humble Student of the Markets blog, says there’s a “decent chance” stocks, “exoneration” aside, are about to deliver explosive gains; perhaps as much as 57%.
Why? The Fed.
“One parallel to the market hiccup of late 2018 would be 1998, when the Fed stepped in to rescue the financial system in the wake of the Russia Crisis,” Hui wrote in a post on Sunday. “A melt-up in the current environment would be supported by the combination of loose monetary policy and easy fiscal policy.”