Markets welcome Bessent’s qualification to lead Trump administration’s Treasury Department

The US stock market appears to be rooting for President-elect Donald Trump’s planned nomination for Treasury Secretary. He told CNBC in early November that he sees a period of strong growth and low inflation ahead.

Stock market futures rose and U.S. Treasury yields fell early Monday following President Trump’s late Friday announcement that he would tap Wall Street household name Scott Bessent to fill the most important economic role of his administration.

The move sent a message that President Trump wants someone with high market credibility and a similar philosophy for the role.

“This selection should please the market, given Mr. Bessent’s deep understanding of financial markets and the economy, particularly the bond markets that the Trump administration needs to have on its side to successfully advance policy.”Evercore said Sara Bianchi. ISI’s chief strategists for international politics and public policy wrote in a memo.

Mr. Bianchi added that the market “couldn’t have done better” than Mr. Bessent.

Markets have been volatile but largely positive since Mr. Trump’s victory earlier this month, triggering a red wave that flipped the Senate to Republicans and maintained a Republican majority in the House. Bond yields in particular have risen significantly, with some interpreting the move as expecting further rise in inflation and others seeing it as traders pricing in stronger growth.

In an interview with CNBC the day after Trump’s victory and before his nomination was announced, Bessent said he hoped the new president’s policies would both reduce inflation and boost growth.

“One thing he doesn’t want to do is repeat what we just got under the Biden-Harris administration,” Bessent said.

“President Trump has some very good ideas, but I guarantee you, the last thing he wants to do is cause inflation,” he added. “I don’t think the bond market is worried about Trump 2.0 inflation. I think what you’re seeing is a healthy move towards driving growth.”

While some investors are concerned that the tariffs President Trump is considering could cause inflation, Bessent said the tariffs could be “layered in multiple layers” to avoid causing more than a short-term adjustment. He said he supported the idea of

“This price adjustment, combined with the other disinflationary things that President Trump is talking about, will bring us below the Fed’s desired 2% inflation target,” he said.

Bessent supports three approaches to addressing concerns about the country’s ballooning debt and budget deficits. It would grow the economy at a rate of 3%, reduce the budget deficit to 3% of gross domestic product (less than half the current level), and add the following: Oil production is 3 million barrels per day.

Wall Street commentary was almost universally positive.

“Bessent gives the incoming Cabinet considerable economic and market credibility,” said perennial market bull Tom Lee, head of research at Fundstrat Global Advisors.

“In our view, this reinforces the ‘Trump put,’ or the market’s perception that the incoming White House wants stocks to do well,” Lee wrote.

Early indications are that Mr. Bessent, who has a long history of supporting Democratic causes before endorsing Mr. Trump during his first run for office in 2016, will have little trouble being confirmed.

Sen. Elizabeth Warren of Massachusetts said in a statement over the weekend that Bessent’s “expertise is helping wealthy investors make more money, and they are being squeezed out by corporate profiteers.” It’s not about cutting costs for families… It’s unclear whether Mr. Bessent will shift his loyalty from Wall Street investors to American workers, but to advance the interests of working families. is willing to work with anyone.”

But Greg Barriere, chief U.S. policy strategist and Washington policy expert at AGF Investments, said Bessent “is sailing toward confirmation” and will be replaced by current Sen. Marco Rubio, whom Trump plans to nominate for secretary of state. He said he would join the group of “moderates.” A cabinet will be formed with support from both parties. ”

“As President Trump pursues an aggressive trade policy, Bessent could be an important counterbalance to Commerce Secretary nominee Howard Lutnick,” said Ed Mills, Washington policy analyst at Raymond James. ” he said.

“If President Trump’s policies accomplish more through economic growth rather than deep budget cuts, markets will view that positively,” Mills said.