Earlier today, US stock traders—and everyone else—got a bit of shock when US president Donald Trump’s former national security advisor, Mike Flynn, pleaded guilty to lying to the FBI about conversations he’d had with Russia’s ambassador to the US. The guilty plea, the charge, and the fact Flynn is cooperating with a special counsel investigation hint there might be something bigger to come. ABC is reporting that Flynn could testify that Trump ordered him to make contact with the Russians during his presidential campaign.
As the news broke, the S&P 500 fell 1.5%. But since then, the market has recovered most of its losses.
Turns out it will take more than a little political conspiracy to completely derail what has been the longest streak of gains for the US benchmark stock market in a decade. Despite it being a politically tumultuous year, the index has posted eight consecutive months of positive returns, which hasn’t happened since the beginning of 2007. Of course, a long run is not evidence of lasting stability and high valuations are making some nervous.
The run of gains is even stronger for the Dow. An eight-month streak of positive returns hadn’t happened since 1995, until now.
Stock traders are seemingly much more interested in the recent strength of the US’s economy and companies. In the third quarter, S&P 500 companies reported an earnings growth of 6.4%, almost double what it was the year before. Just yesterday, the Dow index soared past 24,000 for the first time.
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