Associated Press
- Amid ongoing trade negotiations with China — which by Friday evening had failed to produce a deal — Trump sent a tweet, hinting at "future negotiations."
- In a Friday interview with Politico, held shortly after Trump hit send on this tweet, "Unprompted, the president marveled about the instant effect his China-related tweet had on stock prices."
- President Donald Trump has a predilection for tweeting about the economy, trade, specific companies, and the stock market. Bloomberg, in fact, tracks his market-related Tweets.
- "It seems to be having quite an impact on the market," Trump said according to Politico. "I looked — the market was down. Now I think it’s up 181.44. So, it shows you what happens."
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Amid talks with with China — which by Friday evening had failed to produce a trade deal — Trump sent a tweet, hinting at "future negotiations."
In a Friday interview with Politico, held shortly after Trump hit send on this tweet, "Unprompted, the president marveled about the instant effect his China-related tweet had on stock prices."
President Donald Trump has a predilection for tweeting about the economy, trade, specific companies, and the stock market. Bloomberg, in fact, tracks his market-related Tweets.
And he seems to be aware that his tweets can have at least a short-lived impact.
"It seems to be having quite an impact on the market," Trump said according to Politico. "I looked — the market was down. Now I think it’s up 181.44. So, it shows you what happens."
According to Forbes, however, Trump’s specific naming of companies, which often are in his market-moving tweets, are not that dissimilar to other presidents, though they are "on a broader scale." (Presidents John F. Kennedy and Harry Truman also has an impact on industries, Forbes points out.)
A study done in 2017 at Northeastern University looked at Trump’s tweets from his election to his inauguration, that "identified ten publicly traded firms."
"Using standard event study methods, we find that positive (negative) content tweets elicited positive (negative) abnormal returns on the event date and virtually all of this effect is from the opening stock price to the close," the study explains. "Within five trading days, the CARs are no longer statistically significant."
Of course, Trump’s tweets about trade deals are different in nature, with the markets responding differently than they would to him calling out a specific company.
On Thursday, ahead of the tariff increase, there were jitters on Wall Street over the trade war escalation. Some had hoped for a postponement of the tariff increase, CNBC reported, with traders noting that positive news could come via Twitter.
"You’re living in a world where one Trump tweet can change everything," Art Cashin, UBS’ director of floor operations at the New York Stock Exchange, told CNBC.
On Friday at 12:01 a.m. ET, the US increased tariffs from 10% to 25% on roughly $200 billion worth of Chinese goods; the markets initially dropped in reaction, but "bounced back," the Wall Street Journal reported.
See Also:
- Trump just ramped up tariffs on $200 billion worth of Chinese goods. Here are all the products that will get hit.
- China just took another step toward putting a Canadian to death, in apparent retaliation for its arrest of Huawei’s CFO
- China detonated its tentative trade deal with the US by abruptly deleting swaths of text it didn’t want to commit to, report says
Source: Business Insider – feedback@businessinsider.com (Sarah Gray)