The stock market is tanking today, but don’t blame President Donald Trump for it. Blame his critics.
The market made historic gains following the November 8th election and inauguration, dubbed the “Trump trade.” In particular, the financial sector, and firms involved in infrastructure have been the biggest beneficiaries of the Trump trade. Following two recent scandals (Trump allegedly sharing classified information with Russia’s ambassador, and Trump allegedly asking James Comey to drop the federal investigation into Michael Flynn), even Republican Justin Amash is saying that impeachment would be the appropriate response if Trump is guilty as charged.
Whether or not that’s the appropriate punishment is debatable, but the possibility is clearly spooking the market, and the hopes they had for the economic policies Trump plans to implement.
According to CNBC, U.S. equities fell sharply on Wednesday as investors fretted over the latest news coming out of Washington.
“This is clearly Washington-driven,” said Michael Shaoul, chairman and CEO of Marketfield Asset Management. “It’s a lot like 1998-99, when the market had to deal with the [Monica] Lewinsky scandal.”
The Dow Jones industrial average traded 310 points lower, with Goldman Sachs contributing the most losses. The S&P 500 dropped 1.6 percent, with financials tumbling 3.1 percent to lead decliners. Financials were pulled down by banks, with the SPDR S&P Bank ETF (KBE) falling 4.1 percent.
The Nasdaq composite lagged, shedding more than 2 percent. The major equities also gave up their gains for the month.
On the bright side, it’s refreshing to see so many liberals concerned about the sharing of classified information for the first time since ever.