This week has been great for the stock market, with the Nasdaq surging to record highs and the S&P 500 breaking 2,900 as the United States reached an agreement with Mexico regarding trade.
The Nasdaq surged past 8,000 on Monday, representing diminishing trade fears between investors shortly after a new trade deal was made with Mexico. The president was one of the first to tout the growing stock market as a result of the newly met deal, tweeting: “the Nasdaq has just gone above 8000 for the first time in history!”
Tuesday is a continuation of Monday’s excitement, as the S&P 500 breaks the 2,900 point milestone. The Dow Jones Industrial Average acted much the same way, surging past 26,100 points earlier in the trading day.
The new deal reached by the two North American countries was named the United States-Mexico Trade Agreement, it will reportedly last for 16 years, and it will be placed under review every six years. The United States has yet to negotiate with Canada, but President Trump has indicated that he would be willing to work with Canada if they would settle fairly.
Escaping NAFTA was one of the president’s premier campaign promises. Even today, the president refers to the trade deal as very bad for America, and on Monday he shared his thoughts about the trade deal: “The name NAFTA has a bad connotation because the United States was hurt very badly by NAFTA.”
The stock market has been somewhat volatile lately due to concerns among investors of trade wars between the United States and economic powerhouses such as China. While the trade war continues with China, one that will most likely end with the U.S. convincing China to change their minds on trade (which seems to be the case with our diminishing trade deficit with them and our growing national economy), investors can now act confidently in wake of the new deal struck with the Mexicans.