Market News 28-3

(Axois) Trump wants to couple tax reform and infrastructure spending in order to secure some support from Democrats. NYT says while Trump may struggle to get the corporate rate much below 28%. Most on Wall St are assuming a rate of no higher than 25% vs. early hopes for a cut to 15%.
(Politico) Republicans prob. won’t include funding for Trump’s Mexico wall in the upcoming budget; Republicans don’t want a shutdown battle in Apr and thus could exclude wall funding from the budget as a result
(Washington Post) Trump on Tues to sign an executive order that would begin the process of undoing much of Obama’s climate agenda – Trump’s order would instruct regulators to rewrite key rules curbing US carbon emissions, lift a moratorium on federal coal leasing, and remove the requirement that federal officials consider the impact of climate change when making decisions. Most of the Trump order will take years to implement and is unlikely to alter the shift away from coal and towards nat. gas and renewables.
 (JPM on macro) Healthcare was/is a net negative for the Trump/Ryan agenda but it is by no means fatal and so long as investors anticipate some action on the tax front the SPX will struggle to experience significant weakness (investors appear to appreciate that the tax process is in its very early stages and thus are willing to wait a few more months for details). The nominal growth backdrop remains supportive. The biggest risk for the time being really isn’t political (the entire market is closely scrutinizing Washington and near-term political expectations are low) but instead concerns growth – sentiment around growth has grown quite upbeat (both towards real growth and inflation) but also very complacent and risks are rising (widening gap between surveys and hard data, soft Mar US flash PMIs, soft oil prices, etc. Keep in mind the calendar is pretty sparse over the next few weeks. Most investors are now looking towards the upcoming CQ1 earnings season (which starts Thurs morning 4/13).

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