After today, any lingering doubts about what moves the market—namely, talk of tax reform—should be laid to rest.
The S&P 500 Index moved almost 8 points in the hour after President Donald Trumpsaid he would have the outlines of a tax reform package in a couple weeks. In particular, bank stocks moved because bond yields rose.
The small-cap Russell 2000, which has been underperforming since mid-December, also rallied. Small companies would be among the biggest beneficiaries of a tax cut.
Never mind that House Speaker Paul Ryan indicated that Obamacare would be a priority, and that tax reform wouldn't come until the spring at the earliest.
"It's just the way the budget works that we won't be able to get the ability to write our tax reform bill until our spring budget passes, and then we write that through the summer," Ryan said last week. He added that an infrastructure package "comes out of our spring budget, as well."
Never mind all that! The president said we will have more on tax reform—very soon.