Wednesday, 7 March 2018

Why Gary Cohn's resignation from Trump administration rattles Wall Street

Wall Street has something new to worry about: the resignation of a market-friendly adviser at the White House.

Gary Cohn, the chief economic adviser of President Trump, stepped down from his post after the president opted last week to slap tariffs on steel and aluminum imports, a decision Cohn was not in favor of.

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The initial market reaction to Cohn's departure was negative, as the ex-Goldman Sachs executive was viewed as a pro-business and pro-free trade policy maker. Cohn was also instrumental in getting the landmark tax cut plan passed in December. That plan, which slashed the corporate tax rate to 21% from 35%, will help corporations boost profits, and has helped drive up stock prices.

In pre-market futures trading, the Dow Jones industrial average was down about 250 points, or 1%.

Cohn was well respected on Wall Street and his departure creates fresh uncertainty as to whether Trump will move toward a more protectionist trade policy and who will replace the outgoing adviser. His departure comes at a time when the stock market is already worried about the risk of rising interest rates and fears of a global trade war.



Source: usatoday

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