Newsmax Finance Insider Larry Kudlow told Newsmax TV that President Donald Trump’s tidal wave of change in his first days in the Oval Office was “a very big part” of the momentum that pushed the Dow Jones Industrial Average beyond the 20,000 plateau.
“It's interesting to me, the Dow had a big move up right after the election as people took a careful look at his platform,” said Kudlow, a radio talk-show host and CNBC senior contributor.
“Then there was a little bit of a lull, but now his inaugural speech and the stuff he's done afterwards, signing all these executive orders, have put him right back on the economic growth message and I think that's a big part of the stock market rally," said Kudlow, who served as the Trump campaign's senior economic adviser.
"It's not the only part, I want to add, but it's a very big part of the stock market rally,” Kudlow said Wednesday on "The Steve Malzberg Show."
U.S. stocks climbed on Wednesday and the Dow closed atop the 20,000 mark for the first time as solid earnings and optimism over Trump's pro-growth initiatives revitalized a post-election rally. The S&P 500 and the Nasdaq Composite indexes also closed at record highs for a second consecutive session.
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Trump has made several business-friendly decisions since taking office on Friday, including signing executive orders to reduce regulatory burden on domestic manufacturers and clearing the way for the construction of two oil pipelines, Reuters reported.
But to be fair, there have been other factors turbo-charging the market, said Kudlow — host of "The Larry Kudlow Show" and author of "JFK and the Reagan Revolution: A Secret History of American Prosperity," written with Brian Domitrovic and published by Portfolio.
“Organically inside the economy, it looks like a two-year profits recession is over, it looks like it,” said Kudlow, who was a senior economist in the Reagan White House.
“And secondly, it looks like a two-year recession in business investment is over and those are powerful tonics for the stock market, profits are the mother's milk of stocks and the lifeblood of the economy,” Kudlow said.
“So it looks like we're going to get a bump here in the economy and now you have all this new confidence as per all the surveys that Trump is going to follow through and make good on his economic growth. So you've got a combination: better internal economy and a lot of hope and confidence in Donald Trump's policies,” he said.
The Dow came within a point of the historic mark on Jan. 6, as investors banked on pro-growth policies and tax cuts many expect from the new administration.
However, the index had struggled in recent weeks as investors awaited clarity on the new administration's policies grew cautious.
"It was definitely a milestone that the market has been focused on for really the better part of two months and you were starting to get a little bit of anxiety as to whether it was going to be surmounted or not," Julian Emanuel, equity strategist at UBS in New York, told Reuters.
"We are particularly encouraged to see financials acting well again because they have been the leadership."
As his first few days in office prove, Trump will be a demanding leader who applies the best of his negotiating skills to push for U.S. growth, as bestselling author David Horowitz recently predicted to TheStreet.com.
Trump won’t be an ideological purist like Republicans who support free trade but don't fight for fair trade, Horowitz said.
“We've had an anti-business president now for eight years who doesn't take a hard-nosed attitude towards these deals. Trump is going to get better deals for us, which is still free trade.”
Horowitz's new book "The Big Agenda: President Trump's Plan to Save America," released just this week, reveals Trump's "first 100 days strategy" to roll back Obama's legislative and executive record.
Horowitz's new book is the first book about the Trump presidency and has soared to the top of the Amazon bestseller charts, becoming the No.1-selling book on the web.
Trump will also lead the way in making infrastructure spending to boost the U.S. economy, Horowitz said.
“If the economy grows as it will under Trump, there's going to be a lot more money to spend,” he said.
"Big Agenda: President Trump's Plan to Save America" is available at bookstores everywhere – or get your copy on Amazon – Click Here Now
(Newsmax wire services contributed to this report).
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