Apr 13, 2017 - Economy & Business

Markets are starting to ignore Trump rhetoric

A number of traders are learning to tune out President Trump's rhetoric: The value of the dollar is up today despite Trump's claim that the greenback is "too strong," and pharmaceutical shares are up since his inauguration despite a vow to crack down on high drug prices.

Data: Money.net; Chart: Andrew Witherspoon / Axios
Data: Money.net; Chart: Andrew Witherspoon / Axios

Reversals: The dollar has rallied by 0.43% today, and the Mexican peso has recovered much of the value it lost between Trump's election and his inauguration; since Jan. 20, the peso is up 15.5%. The PowerShares Dynamic Pharmaceuticals ETF, meanwhile, has gained 8.2% since inauguration day, compared with a 4.8% rise in the S&P 500.

Why it matters: Some traders are separating rhetoric from action, and may be scaling back their expectations of how much of the president's agenda will be enacted.

The exception: Bond markets appear to take the president more seriously. Trump has stated a preference for low interest rates, and the yield on the 10-year T-note has fallen 1.75% over the past two trading days.

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