Live Blog

President Trump's Address to Congress

Tuesday February 28, 2017
U.S. President Donald Trump on Tuesday afternoon was putting the finishing touches on his first address to a joint session of Congress, and his spokesman was dispatched to the Capitol to deliver briefings on the major points the president intends to make in the speech, scheduled to begin at 9:10 p.m. Washington time. Join us then for full coverage and analysis.
Photo by Brendan Hoffman/Getty Images
Welcome to the TOPLive blog of President Trump's first address to Congress. 

The White House has promised Trump will deliver an "optimistic" speech that will both talk about his accomplishments over the first month of his presidency and put more meat on the bones of his legislative agenda for the year.
Photographer: Win McNamee/ Pool via Bloomberg

It's also Trump's best chance to reset his administration after what has been a chaotic and turbulent start to his presidency, with his travel ban rollout widely criticized in Congress and stalled in the courts, massive protests, his national security adviser fired in a scandal over his contacts with Russia and a tweet-fueled war with much of the media.
The mood in the room could be unusually tense; Democrats have called Trump's first month incompetent and some denounced his travel ban on seven majority Muslim countries as racist and unconstitutional. Democratic leaders have also charged Trump with profiting off his presidency via his private businesses and have demanded an independent investigation into Russia's attempts to influence last year's election.

Talk of bipartisan efforts on infrastructure and trade have been put on hold as nonstop partisan warfare in Congress stalled many of his Cabinet picks.
Republicans meanwhile are hoping to hear more specifics on Trump's top legislative items, including health care, a tax overhaul and a budget blueprint. Republicans are united on what should be priorities, but deeply divided on the specifics.
AP Photo/J. Scott Applewhite
The House leadership's health plan faces headwinds in both chambers from conservatives and moderates alike, as Republicans are split between moderates who want to preserve the expansion of Medicaid in their states and ensure others don't lose insurance, and more conservative lawmakers who are focused mostly on repealing the law and especially it's taxes.
An Obamacare sign is seen on the UniVista Insurance company office in Miami. Photo by Joe Raedle/Getty Images
Meanwhile, his budget outline already faces bipartisan ridicule at the Capitol. Lindsey Graham, the top appropriator for the State Department in the Senate, called a plan for massive cuts to that agency "dead on arrival" and even Majority Leader Mitch McConnell said they probably could not pass and he did not support them.

And John McCain, the chairman of the Armed Services Committee, told reporters today that his proposed $54 billion increase in Defense spending next year was way too low.
Defense spending as a share of all federal budget outlays has declined to about 16 percent. During the Reagan era it reached as high as 28 percent and was more than 40 percent during the Kennedy and Johnson years when the U.S. was involved in the Vietnam conflict.
Trump has also promised to spend as much as $1 trillion on infrastructure but specifics and a timeline have been elusive. Trump also is expected to keep a hands off approach to Medicare and Social Security, despite a deficit already north of $600 billion a year and expected to rise in coming years as the Baby Boom generation continues to retire.
Trump, who has been known to engage in numerous fights via his Twitter feed, at least is set to appeal to unity:
"The time for small thinking is over.

The time for trivial fights is behind us."
Notably absent tonight will be U.S. Supreme Court Justice Ruth Bader Ginsburg, who has publicly criticized Trump. She is leaving it to five of her colleagues to represent the court.
Photographer: Andrew Harrer/Bloomberg
Naeem Aslam, chief market analyst at Think Markets U.K.:
“Investors have diverted their attention to the keyword, infrastructure.” Aslam said. “This will be the belle of the ball and will be closely watched when he delivers his speech.”
Building and engineering stocks initially soared on Trump’s pledge to rebuild U.S. infrastructure, with companies like Jacobs Engineering, Eagle Materials and Headwaters rising more than 20 percent in November alone. However, patience has worn thin over the past month, as shown by slipping in the S&P Supercomposite Construction Materials Index.
Perhaps no issue, however, has provoked more of a partisan split since Trump has been elected than immigration. There are news reports Trump could call for a bipartisan compromise in his speech tonight.
Photographer: David Maung/Bloomberg via Getty Images
Key excerpt on taxes so far, promising "massive tax relief":

"My economic team is developing historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone.

At the same time, we will provide massive tax relief for the middle class."
Key excerpt on Obamacare. Not a lot of policy specifics here:
"Tonight, I am also calling on this Congress to repeal and replace Obamacare, with reforms that expand choice, increase access, lower costs, and at the same time, provide better Healthcare.

Mandating every American to buy government-approved health insurance was never the right solution for America.

The way to make health insurance available to everyone is to lower the cost of health insurance, and that is what we will do."

Here is a fuller list of excerpts from Trump's address as prepared for delivery:
  • We’ve spent trillions of dollars overseas, while our infrastructure at home has so badly crumbled.
  • We have begun to drain the swamp of government corruption by imposing a 5-year ban on lobbying by Executive Branch Officials – and a lifetime ban on becoming lobbyists for a foreign government.
  • By finally enforcing our immigration laws, we will raise wages, help the unemployed, save billions of dollars, and make our communities safer for everyone.
  • I directed the Department of Defense to develop a plan to demolish and destroy ISIS. We will work with our allies, including our friends and allies in the Muslim World, to extinguish this vile enemy from our planet.
  • We must restart the engine of the American economy – making it easier for companies to do business in the United States, and much harder for companies to leave.
  • My economic team is developing historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone.
  • We will provide massive tax relief for the middle class.
  • I am also calling on this Congress to repeal and replace Obamacare, with reforms that expand choice, increase access, lower costs, and at the same time, provide better Healthcare.
  • The way to make health insurance available to everyone is to lower the cost of health insurance.
  • My administration wants to work with members in both parties to make childcare accessible and affordable, to help ensure new parents have paid family leave, to invest in women’s health, and to promote clean air and clear water, and to rebuild our military and our infrastructure.
  • I am sending Congress a budget that rebuilds the military, eliminates the defense sequester, and calls for one of the largest increases in national defense spending in American history.
The speech is taking place just as the Asian trading day is getting going, and investors in this region will be listening out for any whiff of protectionism from President Trump.

China's yuan, which Trump has claimed is kept artificially weak by the local authorities to make exports more competitive, is actually stronger against the dollar this year, while the South Korean won is the biggest gainer in Asia. Those moves could neutralize the potential for any criticism from Trump tonight.

Some on Wall Street think the best result for stocks would be for Trump to continue skimping on details. The more that’s left up to the imagination, the easier it is for equity investors to convince themselves to continue buying:
“You’re at the part of a policy cycle where anything is possible -- no compromises have to be made and no disappointments have happened,’’ Andrew Sheets, Morgan Stanley’s chief cross-asset strategist, said in a Feb. 24 interview on Bloomberg Television. “In some ways the market might actually like a speech that’s a little more vague because it allows everybody to fill in the version of tax reform or tax cuts they have in mind. The more specific it gets about the potential offsets, like border adjustment tax, the more nervous the market could be.’’
It's all about the dollar for markets as traders await the start of Trump's address. The greenback is building on last session's gains as Asian trading gets going for Wednesday.

The currency's currently up at least 0.2 percent versus the yen, Singapore dollar, Taiwan's dollar and the kiwi. Can Trump help it extend those Fed-speak-fueled gains?
Can Trump reignite the so-called reflation trade tonight? The consensus seems to be that he'll need to provide details on fiscal policy and spending to really get the fire going again.

After soaring in the wake of Trump's election, the greenback has had a mediocre start to 2017, with the Bloomberg Dollar Spot Index steadily retreating from the record high reached Jan. 3. Not even mounting bets on a Fed rate hike as soon as this month has budged the currency, which is also languishing amid low volatility. 

Not a huge amount of detail there in those speech excerpts, that could be why the Bloomberg Dollar Spot Index is coming off a tad:

Also, many Democratic women are wearing white in protest - saying it is the official color of the suffragette movement.

“We wear white to unite against any attempts by the Trump Administration to roll back the incredible progress women have made in the last century, and we will continue to support the advancement of all women. We will not go back,” said Congresswoman Lois Frankel, Chair of the Democratic Women’s Working Group.
As we wait for the speech to start, U.S. stock index futures are holding gains, with those on the S&P 500 Index up about 0.3 percent, and contracts on the Dow Average rising 0.2 percent.

Equities have been among the biggest beneficiaries of the Trump trade.
An announcement on infrastructure spending could light a fire under the dollar, already rising amid some more hawkish Fed talk, says Margaret Yang Yan, an analyst with CMC Markets in Singapore:

"If President Trump is going to announce a massive infrastructure plan or hint at a big stimulus package, then the market will have more reason to believe that the Fed will speed up the rate normalization."

Odds of a U.S. rate hike this month breached 50% Tuesday.