T3’s Take 3: Healthcare Vote Postponed, Market Breathes a Sigh of Relief – T3 Live
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T3’s Take 3: Healthcare Vote Postponed, Market Breathes a Sigh of Relief

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1) Healthcare Drama Continues

The drama over the GOP healthcare bill continued today as legislators went down to the wire trying to round up votes.

Earlier today, House Speaker Paul Ryan warned President Trump that Republicans may not have the votes to pass their health-care bill.

And at around 3:30 p.m. ET, Trump announced that the vote would be postponed again.

Many market observers believe that if Trump can't get this bill through, he may also have trouble pushing through other major policy initiatives like tax reforms.

2) Market Relieved

Stocks were down for much of the day before catching a bid on the postponement of the healthcare bill vote.

That squeezed the S&P back into the green before the index finished down fractionally at 2343.98.

The delay in the vote also pushed the US dollar into the green, and banks and biotechs rallied very quickly.

Presumably, traders believe Republican can indeed get the votes they need to pass the bill and keep the broader Trump agenda on track.

The VIX broke 14 for the first time since January 3, but was red by the equity market close.

However, for most of the day the prevailing trend — weak dollar, weak banks, weak small caps — was still in place.

3) So What's Next?

Aside from the pop into the close, markets are definitely showing mores signs of stress.

The sentiment indicators I track have shown a shift from bullish to bearish territory over the past month.

The reversal of the Trump trade feels like a change in the market cycle, though to be fair, the major averages have barely budged.

I'd keep it simple.

Watch small caps (IWM), regional banks (KRE), and biotech (IBB).

If they all start getting hid, the bull may really be leaving the building.

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