Stocks Slow to Rebound From ‘Worst Christmas Ever’

Treasury Secretary Steve Mnuchin talks with reporters about trade negotiations with China, at the White House on Dec. 3, 2018, in Washington. (AP Photo/Evan Vucci)

WASHINGTON (CN) – As the American stock market struggled through what was termed the “worst Christmas ever,” economically speaking, President Trump said he is still confident in his treasury secretary, Steven Mnuchin.

Rumors of Trump’s displeasure with the former hedge fund manager and movie producer swirled on Christmas Eve as the Dow plunged 653 points, but Trump defended Mnuchin in a reporter pool over the holiday, calling his appointee a “very talented guy” and a “very smart person.”

On Wednesday morning, as the market opened with marginal increases for the Dow, S&P 500 and Nasdaq, CNN quoted sources inside the White House told as saying the idea that Trump would boot Mnuchin was “nonsense.”

Mnuchin made headlines when he reached out to the nation’s top CEOs and bank heads last week to reassure them the market was strong and healthy. 

“We continue to see strong economic growth in the U.S. economy with robust activity from consumers and business,” Mnuchin said in a statement after announcing the calls. “With the government shutdown, Treasury will have critical employees to maintain its core operations.” 

But those in the industry were puzzled by the call. 

“Panic feeds panic and this looks like panic in the administration,”  Grant Thornton’s chief economist Diane Swonk told the Washington Post on Sunday. “Suggesting you might know something that no one else is worried about creates more unease.”

Still, if Mnuchin’s weekend phone call did anything to quell fears, Trump’s Twitter attacks against the Fed on Christmas Eve appeared to undo them.

“The only problem our economy has is the Fed. They don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Democrat Shutdowns over Borders,” the president wrote just before 11 a.m. on Monday. “The Fed is like a powerful golfer who can’t score because he has no touch – he can’t putt.”

Politico “Morning Money” columnist Ben White posted a graph Monday on Twitter after the president’s online comments, showing a dip and slight recovery in the market. “Markets tank as Mnuchin appears to panic. Then they begin to recover,” he wrote. “Until Trump Fed bashing tweet hits the tape. Then down we go again.”

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