zerohedge.com / by Tyler Durden / Feb 27, 2017 11:41 AM
Traders are on edge ahead of tomorrow’s key address by President Trump to Congress, in which as Bloomberg writes “trillions are at stake.”
Since Trump’s election, the S&P 500 has risen by 10%, posting 17 record closes in a rally that’s added $2.8 trillion in value to the U.S. equity market, with economists divided on how much of the rally is due to hopes from Trump’s pro-growth promises, how much due to corporate earnings growth (which are expected to rise 12% from last year’s energy-depressed levels), and how much due to the organic growth of the economy.
While it isn’t considered a State of the Union address since it falls within Trump’s first year, the initial speech to Congress has been no less important to presidents in the modern era.
The biggest wildcard, as documented over the past few months, are the details on Trump’s growth plan, with an emphasis on his proposed tax and spending cuts, offsetting the aforementioned $54 billion increase in defense spending, all of which so far have been sorely lacking.