June 4 Strategas Research Partners Chief
Executive Jason Trennert says he believes 2017 will continue to
be a banner year for stocks, particularly those tied to the
so-called Trump trade.
Trennert said in an interview with Barron's that he sees
sectors like energy and financials having underperformed so far
in 2017 and expects them to shine in the second half of the
"The Trump trade is underpriced," Trennert said in the
article. "Expectations are so low that any sense of growing
confidence in the White House would be a big positive surprise."
Strategas, which correctly predicted Trump’s 2016
presidential win, was founded in 2006 when Trennert, Nicholas
Bohnsack and Don Rissmiller left research firm ISI Group,
according to Barron's.
Daniel Clifton, Strategas' head of policy research, said the
firm was also optimistic that Congress would pass meaningful tax
reform legislation and was expecting Trump to push through $50
billion of fossil-fuel energy project spending that had been
halted by the Obama administration.
He believes the administration will be able to pass "pretty
meaningful pro-growth tax reform that lowers the effective tax
rate by 400 basis points (4 percentage points) and allows
foreign profits to be repatriated."
"Repatriation alone would boost earnings per share by $2.58
on the S&P 500 in 2018," Clifton said. "If you have successful
tax reform, you’re looking at $7 to $8 of additional (earnings
per share) in 2018 that isn’t baked into earnings estimates
(Reporting by Dion Rabouin in New York; Editing by Peter