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Pros Tackle Market Reaction, Democrats' Strategy After Trump's Oval Office Address

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Pros Tackle Market Reaction, Democrats' Strategy After Trump's Oval Office Address

President Donald Trump argued in a televised address Tuesday that border security is a "choice between right and wrong, justice and injustice." Here's how some experts reacted to the president's first Oval Office address. 

Financial Market History On Trump's Side

If past history is any indication of future performance, the markets should react favorably to Trump's televised announcement, CNBC's Martin Soong said during Tuesday's "Street Signs Asia" segment. In nearly nine instances out of 10, the market reacted positively either immediately after or shortly after a presidential address, he said. 

Most recently, the Dow moved higher by 2.54 percent following President Barack Obama's announcement of the end of combat operations in Iraq in 2010, and the Dow gained 0.26 percent following President George W. Bush's 2003 announcement of the start of the same war. 

In addition to Soong's statistic, Scott Clemons of Brown Brothers Harriman Private Banking said history shows that government shutdowns are "usually are followed by a pretty good market response."

2020 Implications 

Trump's Tuesday address wasn't meant to change anyone's mind on the hotly debated border conversation, European Council on Foreign Relations Research Director Jeremy Shapiro told CNBC in an interview early Wednesday. Rather, Trump was looking to "excite his base to show up" in the 2020 election and "depress the turnout of the other side," Shapiro said. 

Democrats Won't Bend

One of the dominant themes of the 2018 midterm election was border security, and Democrats gained 40 seats — which may imply the Democrats won't "bend" in negotiations with Republicans, Peter Trubowitz, head of international relations and director of the United States Centre at London School of Economics and Political Science, told CNBC.

Democrats will only make a deal if there is a "very big concession" on the Republican side, he said. 

"I could imagine a grand bargain where they provide some additional funding for a wall in return for serious immigration reform to deal with the DREAMers," Trubowitz said. "That's something they can take back to their political base."

Related Links:

Trump, Democrats Not Budging On Border Security, Shutdown Positions

States Where Trump's Approval Rating Is Highest, Lowest

Posted-In: Barack Obama border wall CNBC Donald Trump George BushPolitics Media General Best of Benzinga

 

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