A new analysis found finance professionals declared the stock market is being increasingly driven by President Donald Trump’s temperament rather than rational capital allocation.
Politico’s analysis reported investors abandoned traditional earnings and cash flow analysis, instead obsessively speculating about which companies will gain or lose Trump’s favor.
Firms are systematically forecasting which industries will benefit from White House policies, weighing which CEOs have presidential access and whether announcements could transform company prospects overnight.
Henrietta Treyz, co-founder of Veda Partners, told Politico, “I’ve been doing this for 20 years; I’ve never seen it like this.”
Her clients regularly ask which specific sectors, particularly copper mining and polysilicon production, will gain the administration’s attention.
Finance expert Luigi Zingale warned this is unsustainable, explaining, “We’re no longer trying to figure out what is the next good allocation of capital, we’re trying to figure out what is the allocation of capital most favored by President Trump.”
“It’s a terrible sign of not only the market, but the economy.”
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