The U.S. stock market reacted positively to President-elect Donald Trump’s likely choice for Treasury secretary, who expressed optimism about strong growth and lower inflation in an interview with CNBC in November. Stock market futures increased and Treasury yields fell on Monday after the late Friday announcement that Scott Bessent, a well-known figure on Wall Street, would be selected for the crucial economic role in Trump’s administration.
The decision signaled Trump’s preference for a candidate with solid market experience and a compatible economic philosophy. Analysts like Sarah Bianchi from Evercore ISI praised the pick, highlighting Bessent’s expertise in financial markets and the economy, especially in managing the bond market crucial for advancing the administration’s agenda successfully.
Following Trump’s recent election victory, which also saw Republicans gaining control of the Senate and retaining the House, the markets have generally been positive but volatile. Bond yields have risen, with differing interpretations – some anticipating increased inflation and others predicting stronger growth.
In an interview with CNBC after Trump’s win, Bessent expressed confidence that the new administration’s policies would curb inflation while boosting growth. He emphasized the importance of avoiding inflation and suggested a gradual implementation of tariffs to prevent significant price hikes.
Bessent proposed a strategy focusing on growing the economy, reducing the budget deficit, and increasing oil production to address concerns about national debt and deficits. Wall Street experts, including Tom Lee from Fundstrat Global Advisors, viewed Bessent’s nomination favorably, seeing it as a sign of economic stability and support for equities.
Despite some concerns from the political left, particularly from Sen. Elizabeth Warren, Bessent is expected to face minimal obstacles during the confirmation process. Washington policy analysts like Greg Valliere and Ed Mills anticipate Bessent’s smooth confirmation and believe he could provide a balanced approach within the Cabinet, especially in contrast to other nominees like Howard Lutnick for Commerce Secretary.
