While the new revelations caused a precipitous falloff in U.S. equities, investors still assessed its impact on the Trump administration’s proposed policies, and some losses were quickly pared.
“I think people are worried that it just means more political uncertainty, and sort of a continuation of the stalemate in Washington, a continuation of the delay in trying to get the Trump agenda passed through Congress,” Robert Pavlik, chief market strategist at Boston Private Wealth, told Reuters.
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Some also attributed the quick selloff to institutional-level algorithms. Bucky Hellwig, senior vice president at BB&T Wealth Management, argued that “they look for certain words in news, so we saw this selloff.”
Looking ahead, investors will be closely watching the Federal Reserve Chief Janet Yellen’s two-day testimony starting Wednesday as the Fed preps for unwinding its massive accumulation of debt acquired to ease the financial downturn.
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