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Davos 2018: What Trump’s first year has meant for markets

United States President Donald Trump's administration has been a good one for the U.S. economy - although perhaps not as good as he'd have you think.

January 20, 2018 marked the one-year anniversary of United States President Donald Trump’s inauguration. Here, analysts from across Thomson Reuters take a look at what has been happening in the financial, legal and tax industries since President Trump was sworn in.

An electronic sign shows the fall in the Dow Jones Industrial Average at the New York Stock Exchange at the close of the trading session in New York City. REUTERS/Mike Segar
An electronic sign shows the fall in the Dow Jones Industrial Average at the New York Stock Exchange at the close of the trading session in New York City. REUTERS/Mike Segar

Executive Orders – Westlaw

President Trump signed more executive orders in his first 100 days in office than any U.S. president since World War II. How does his first full year compare to his predecessors?

To find out, we analyzed Westlaw data to determine the number of executive orders issued during each president’s first 365 days over the past 25 years. Our Westlaw research revealed that Trump issued 58 executive orders, which puts him in second place compared to prior presidents’ first years.

Trump’s 58 executive orders put him ahead of President George W. Bush (56), President Barack Obama (41) and President George H.W. Bush (33), and only one behind President Bill Clinton (59). (Figures reflect the first 365 days in office for each president, starting with January 20 of the start year until January 19 of the following year.)

Trump’s executive orders have addressed the conventional, such as ethics requirements (No. 13770) and drug policies (No. 13784), as well as more controversial areas. For example, he touted his first executive order (No. 13765), as a step towards repealing the Affordable Care Act, while his fourth (No. 13769), has commonly become known as the “Muslim ban.” Among his most recent executive orders is No. 13820, which revoked an executive order he signed in May – No. 13799 – to establish the Presidential Advisory Commission on Election Integrity; No. 13820 disbanded the controversial commission Trump created to investigate alleged voter fraud.

However, as Reuters reported in November: “Many of the Republican president’s most significant executive actions, in areas from immigration and transgender rights to energy and the environment, have been impeded by court rulings in cases brought by Democratic state and local officials as well as liberal advocacy groups.” The same Reuters article noted this response to presidential actions isn’t unusual: “Similarly, important executive actions taken by Trump’s Democratic predecessor Barack Obama were stymied by lawsuits filed by Republican state attorneys general, including one eventually decided by the Supreme Court that was intended to protect millions of immigrants in the country illegally from deportation.”

A judge wearing white gloves stands before a special session of the United States District Court for the Southern District of New York.       REUTERS/Carlo Allegri
A judge wearing white gloves stands before a special session of the United States District Court for the Southern District of New York. REUTERS/Carlo Allegri

Deal making and capital markets – Deals Intelligence

  • U.S. deal-making reached US$1.37 trillion from 12,235 merger & acquisition (M&A) transactions during Trump’s first year, leading all modern presidents by both value and number of deals. The value of deals; however, declined by 17 percent compared to 2016.
  • Sixteen M&A deals over US$10 billion, valued at US$490.4 billion, have been announced since Trump’s inauguration in 2017, down from 23 during the previous year and 42 two periods ago.
  • U.S. cross-border M&A totaled US$539.3 billion from 4,872 M&A deals, a 10-year high for number of deals. But value cross-border M&A is down 27 percent compared to a year ago, attributed to the 46 percent decline in U.S. inbound transactions.
  • U.S. firms raised US$3.03 trillion in capital since Trump was sworn in, the strongest period for capital raising since the financial crisis.
  • U.S. follow-on offerings raised US$494.7 billion in proceeds from 3,695 offerings during Trump’s first year, a record year for number of follow-on transactions.
  • Twenty-seven technology companies tapped the U.S. markets for the first time, raising a combined US$9.2 billion in capital, up more than threefold compared to 2016. U.S. initial public offerings (IPOs) were led by Snap’s US$3.9 billion IPO.
  • Corporate bond issuance reached an all-time high since Trump’s inauguration, totaling US$1.52 trillion.
The Union Jack is reflected in raindrops on a car window from the electronic message sign at the NASDAQ Market Site in New York's Times Square. REUTERS/Mike Segar
The Union Jack is reflected in raindrops on a car window from the electronic message sign at the NASDAQ Market Site in New York’s Times Square. REUTERS/Mike Segar

Tax reform – Tax & Accounting

Trump’s tax reform package was the landmark of his first year in office. So far, stock markets appear to have reacted positively

In order to determine whether the market reaction to Trump’s tax cuts is exceptional, it’s useful to compare it to the market reaction of two previous tax reform packages; those of Bush in 2003 and Reagan in 1985-1986.  For comparison’s sake, we analyzed the Dow Jones between the introduction of the initial tax cut bill in the House of Representatives, and at the end of the process; the day of the signature of the president.  Over the same periods (introduction to signature) the Dow Jones grew 5 percent (1,237.8 points) for Trump; 12 percent (908.13 points) for  Bush and 20 percent (349.44 points) for Reagan.


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