The Mueller probe has been hanging like a dark cloud over the White House, but maybe not over the stock market anymore.
The exit of Attorney General Jeff Sessions comes as expectations build for a final report from special counsel Robert Mueller that will show whether the Trump campaign colluded with Russians or not, among other things. But President Donald Trump's naming of Matt Whitaker as an interim attorney general has assuaged some concerns on Wall Street that Mueller will find Trump at the center of his probe.
"I think the market consensus is they probably have something but not enough to change the administration," said Art Hogan, chief market strategist at B. Riley FBR. "I think the market looks at this as yes, it's a bit of an overhang, but not one that's going to create a constitutional crisis. ... I think that's been compartmentalized."
Trump has repeatedly said there was no collusion between his campaign and Russia. So far, Mueller's probe has led to the indictments of more than 30 people, including mostly Russian nationals, but also former Trump campaign manager Paul Manafort and former National Security Adviser Michael Flynn.
Trump, however, appears ready to point to any potential problems he might face as a reason behind stock market weakness. As stocks sold off Monday, Trump tweeted that the "prospect of Presidential Harassment by the Dems is causing the Stock Market big headaches!"
"There's Trump the man," said Wedbush Securities' Steve Massocca. "Then there's Trump the agenda, and the market loves the agenda — lower taxes, less regulation, pro-business. Anything that is potentially disruptive to that agenda is bad. Or anything that is going to prevent the agenda from being stopped is good."
"To the extent that people think the Mueller investigation is not going to do anything negative to the Trump administration, they will like that," said Massocca. "Whitaker is very supportive of Trump, and he's publicly made negative comments about the Mueller investigation."
While strategists do not see a huge threat to Trump from the Mueller probe at this point, there are still doubts about what might come up elsewhere.
"Mueller is investigating Trump and Russia cooperation in influencing the election. If he can't show it, it's got to be a bullish signal. NY AG is looking into Trump's personal financial dealings. That's a risk that has legs," said Jack Ablin, chief investment officer at Cresset Wealth Advisors.
Federal prosecutors in New York, meanwhile, are separately investigating whether there was violations of campaign finance law in the payoffs of porn star Stormy Daniels and Karen McDougal. Trump's former lawyer, Michael Cohen, pleaded guilty to campaign finance violations and is cooperating with prosecutors.