President Donald Trump and his administration appear to have shifted their focus from the stock market to the 10-year Treasury yield as a measure of economic success. Despite a significant stock market sell-off triggered by Trump’s recent tariff policies, the president has shown no signs of backing down. The S&P 500 fell by as much as 2%, erasing postelection gains, while the Nasdaq 100 entered a correction, dropping 10% from its recent peak.
In the past, Trump frequently highlighted a strong stock market as a sign of a successful presidency. However, Treasury Secretary Scott Bessent indicated that the administration is now more focused on Main Street, emphasizing borrowing costs for small businesses and consumers, which are often linked to government bond yields. Bessent specifically pointed to the 10-year Treasury yield as a key metric, noting that Trump wants lower rates.
The yield on the 10-year Treasury bond dropped by 4 basis points on Tuesday and has fallen by 35 basis points over the past 10 days, reflecting investor concerns about tariffs’ impact on economic growth. This bond rally has led to Treasurys outperforming stocks since the election, according to Bloomberg data.
Wall Street forecasters had anticipated that Trump would intervene if markets became too volatile, but his recent actions have challenged those expectations. On Truth Social, Trump’s posts have centered around tariffs, immigration policy, and peace negotiations between Russia and Ukraine, with no mention of the stock market.
This marks a notable change from 2020, when Trump celebrated stock market gains, even autographing a chart showing the Dow Jones Industrial Average’s rise following his declaration of COVID-19 as a national emergency. Recently, however, Trump has remained silent on the stock market despite equities trading lower than they were after his November election victory.
— news from Business Insider