The House is expected to tally the votes on Thursday. A losing vote or any delays could weigh on confidence in the new administration’s ability to deliver on his promises of tax cuts, deregulation and fiscal spending, a number of policy points that have supported the recently strong economic outlook and so-called Trump rally. Some are now concerned that the rally in equities have pushed valuations over fundamentals.
“Perhaps the market is a bit ahead of itself,” Bill Northey, chief investment officer at the private client group of U.S. Bank, told the WSJ. “There’s been very clear evidence of momentum building in the global economy but having some of those policies, namely tax reform and some of the regulatory rollbacks, has clearly been part of what’s driving markets.”
Concerns over Trump’s ability to pass through his legislative agenda through Congress triggered the largest one-day sell-off since before the elections on Tuesday.
“There’s been a lot of optimism regarding the Trump administration so this could very well be the first setback,” Erik Davidson, chief investment officer at Wells Fargo Private Bank, told Reuters. “What the market wants is to get through the healthcare question so that we can move on to tax reform.”
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