U.S. markets have been stuck within range after a post-election bull rally on speculation that Trump would enact expansionary policies, such as tax cuts, reduced regulations and high fiscal spending. However, the market momentum has fizzled in recent weeks on Trumps more controversial actions like restricting travel to the U.S. and withdrawing from a trade deal.
“What you have is a tug-of-war between near-term positives in terms of economic data and earnings season juxtaposed against the confusion over what’s important in the first 100 days of the new administration and when will we get to see things like tax reforms,” Art Hogan, chief market strategist at Wunderlich Equity Capital Markets, told Reuters.
Meanwhile, the strong fourth quarter earnings season continues to support the loftier valuations in the equities market, with earnings of S&P 500 companies estimated to have risen 7.5%, the best growth in nine quarters, according to Thomson Reuters.
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