Donald Trump has made great political capital out of the strong performance of the S&P 500 and other US markets since he took office in November 2016. In fact, the Dow Jones saw a record-breaking 22,000 in August of this year. But is the success because of the Donald, or despite him?

Here are a few factors behind the recent stock market highs:

Economy Already Strong

Experts say that Trump’s policies may not be the root of the recent successes. In fact, they’re the result of ongoing economic trends rooted in recovery from the recession. Unemployment is low (4.3%) and overseas markets are strengthening.

Trump’s White House has yet to announce any huge fiscal changes – he’s been caught up with healthcare reform and foreign policy – but the highest earnings per share growth across the market since 2011 means the markets can be patient.

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Both Government Houses Republican

The stock markets and indices are usually concerned when there is a threat of political disunity. After the last election, both the American House of Representatives – and the Senate – are both in the same hands. Struggles behind the scenes may yet bring out wobbles among investors, but for now, the reactions haven’t been strong.

Wall Street Likes Trump’s Plans

The new president came in promising tax cuts, deregulation, spending on infrastructure and lots of other things that the markets like. These haven’t yet been laid down in hard policy but it seems investors believe there will be progress. The problem will come if that’s not delivered quick enough.

It’s also worth mentioning here that some investors may have been concerned about elements of Trump’s agenda, such as tariffs and cracking down on legal immigration. These would be a tough job to push through Congress and it seems that investors know it.

Markets Rise On Elections

It’s possible that the uptick in the S&P 500 has nothing to do with the actual candidate, but is a wider reflection of how the US system reacts to elections and midterms. In the bigger picture, history shows the market often enjoys a boost in an election year. This means a more insightful view on Trump’s impact might be better gathered after the 2018 midterm elections.

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