Markets have been broadly flat ahead of the long-awaited press conference by President-elect Donald Trump, which is scheduled to begin today at 11am Eastern Time. He has not answered questions from journalists in a formal setting for almost 6 months, which was well before the end of the Presidential campaign. As the Trump Presidency is shaping up to be something of a controversy, and that’s an understatement, there is a great deal of anticipation and concern over what he may or may not say. In fact, he is under no obligation to take any questions, but even if he does not, he is expected to flesh out the details of certain issues and such clarifications are eagerly awaited.
There are several policy issues he is expected to address, such as his immigration and trade policies, and his plan to repeal the Affordable Care Act (“Obamacare”). However, it is telling that he will probably need to begin by addressing the issues that are looming largest in the current news cycle: allegations including conflict of interest issues against himself, his son-in-law, and several of his nominees to other major appointments.
The news has been dominated today by a story that appears to be very far-fetched, yet is seemingly sourced correctly: the intelligence establishment believes that the Russian government holds compromising information on the President-elect. There are numerous rumors regarding the details, which are mostly not fit to print in the proverbial family newspaper. We can expect the President-elect to come out swinging (he has already strongly denied the claims) and it would not be very surprising if he promises an enquiry into the U.S. intelligence services. He is likely to also put forward an argument as to how he and Jared Kushner can divest themselves of any conflicted holdings.
The press conference is going to be a major test for the President-elect. He will need to strike the right balance between self-assertion, conviction, and a Presidential-style loftiness. He has already managed this in public appearances since he won the election, it is his tweets that revert to the old-style of campaigning Mr. Trump.
Markets have been flat, trends are petering out, and with New Year repositioning, it seems likely that stocks will either resume an onwards march or begin a more convincing sell-off. This is likely to depend at least partially upon the prospect of a smooth and competent transfer of power in the United States.