The market was poised to take off but a combination of factors, including a tweet that has Washington now focused on something nonsensical that doesn’t help anyone’s life, but the time consumed does, as the clock is ticking.  Delaying the Trump Economic Agenda hurts overall growth for this year and next, and earlier this week forced the IMF to lower their economic outlook for the United States.   Let’s just say, it’s a long ways from three percent.

IMF Pushes for Trump Agenda

IMF indicates that Trump's agenda will bring higher US growth if implemented:

6. A comprehensive policy package is needed. The administration’s priorities include taking steps to spark faster economic and productivity growth, stimulate job creation, incentivize business investment, balance the budget, bring down the public debt, and create fiscal space to finance priorities such as infrastructure. 

14. The U.S. needs a fundamental tax reform. There is broad agreement on the objectives: simplify the system, lower marginal rates, scale back the extensive network of tax preferences, incentivize labor force participation, mitigate income polarization, and support low and middle-income households

Business Tax.

The U.S. corporate income tax could move to a rent tax (either a cash flow tax or an allowance for corporate capital tax) with a somewhat lower marginal rate.

• Taxing offshore profits 
• Individual income tax 
• Pass-through entities
• Consumption taxes 

23. A skills-based immigration system would enhance labor participation and productivity. 

Remainder of Session

When a stock or index fails to breakout after numerous attempts, it often triggers pullbacks.  This is the risk of the current session and remainder of the week as we head into a holiday that will result in thin trading sessions that only amplify volatility and exaggerate direction.

Our work suggest the market goes much higher, but exogenous news and growing anxiety continue to present a higher hurdle than underlying fundamentals.