Helge Petermann

Does the Trump Market Rally Have Legs?

FILE PHOTO: Trump signs an executive order at the White House in Washington
Will the stock market rally that began with Donald Trump's election continue? Source: Reuters / Kevin Lemarque

Helge Petermann, a native of Hamburg, has lived and worked for nearly three decades in New York. He is managing director of River Street Capital, a private equity boutique advisory firm in Manhattan. He spoke in Berlin on Thursday with Handelsblatt Global Edition editor-in-chief Kevin O’Brien about investor reaction to the election of U.S. President Donald Trump.

 

We’re 40 days into the presidency of Donald Trump. There’s uncertainty whether Mr. Trump will be able to get his legislative agenda through Congress. But one group that seems to have no doubt, that has already bought his package, so to speak, is Wall Street.

You’re right. The market reaction to Mr. Trump’s election has been very positive. The markets have rallied. The equity markets are at record highs. We have seen some negative reaction in the bond market because some people are concerned about potential deficit spending. From that perspective, it’s fair to say that for now, the market is buying the package.

 

 

Clearly the market mood is upbeat right now. The president has proposed to deregulate and cut taxes for businesses. This is music to the ears of investors. Do you think he’ll be able to deliver on his promises?

The Republicans have the majority in both houses. And from that perspective, it looks like he has the wind in his sails. Now there are also some people in the Republican Party who in the past have been skeptical about increased spending. They have always liked the idea of reduced taxes and reduced regulations. So in theory the president should be able to deliver, but obviously the Democrats will be opposing a lot of his proposals, so we will see how long it will take to implement what he wants to deliver.

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