If Trump is doing so horribly, why is the stock market doing so well?

Win McNamee

• Donald Trump likes to take credit for new stock market highs, but that idea is being increasingly rejected by both Wall Street and investors.
• Business Insider spoke to three big money managers who provided a wide range of alternative reasons for the stock market's continued excellence.

The stock market doesn't revolve around Donald Trump, regardless of what the president tries to claim.

This much should be clear to anyone who's enjoyed a seemingly endless series of record highs, even as Trump has failed to make progress on the policies he's been proposing for months. Sure, politicians and their supporters like to take credit for good news — no matter where it comes from. Treasury Secretary Steve Mnuchin even went as far as warning on Wednesday that the market would sink if Trump's tax plan isn't adopted, because — he said — it's responsible for recent market records. 

It's true that Trump inspired a rally that immediately followed the election — something noted by Business Insider in a recent assessment of the president's market proclamations — but for the past several months, there have been other factors lifting stocks to all-time highs.

Wall Street certainly agrees. In a recent client note, Credit Suisse chief US equity strategist Jonathan Golub lamented the undue credit Trump seemed to be getting for stock records. Meanwhile, Morgan Stanley equity strategist Adam J. Wilson said earlier this week that Trump's tax plan isn't yet priced into the market.

But just to make sure, Business Insider spoke to the managers of three multi-billion-dollar funds, who all acknowledged that the so-called "Trump bump" has faded. While they think any tax reform measure that gets passed could renew the president's influence on stocks, they credit the records to factors outside of the president's control.

And interestingly enough, they each provided a different reason, which speaks to the fact that a great deal is going right for the US market right now outside of Trump.

Here are the three factors to which they're attributing the record-breaking stock market:

"The new records have everything to do with earnings. You really don't need to get much fancier than that. Over time, earnings have been what's determined the direction of the market — far more than interest rates or anything else. It was about a year ago that earnings were really stuck in the mud, but there's been a tremendous improvement from the expected growth rate, which is all tied to the economy.

It's obvious that the stock market follows earnings, but the market narrative always wants to find something more interest. But the reality is very simple: the market has gone higher because earnings have improved."

— Kevin Caron, market strategist and portfolio manager, who helps oversee $180 billion at Stifel Nicolaus

"The underlying economy has performed better than a lot of people expected. You're starting to see a lot of capital expenditures take place through corporations. You've got better confidence coming from individuals. There's not as much concern about the Fed aggressively raising rates. And the economies around the world have performed better. It's a broad-based growth picture that's not necessarily strong, but is beating expectations.

There's nothing to sell off of. As long as rates remain under control and restrained, the economy is doing better, and provides the big picture for what's going on. It's helping to stabilize the stock market. Not to mention there aren't many alternative places to put your funds. That's driving a lack of selling."

— Bill Schultz, who oversees $1.2 billion as chief investment officer of McQueen, Ball & Associates

"The seasonal factor is playing a big role. We're out of the 'sell in May and go away' timeframe. Historically, this last part of the year has represented a time when stocks do well, and I think that's sucking in some money from the sidelines. We've been waiting for a correction that hasn't come, and it's increasingly looking like we're not going to get one — at least to the degree people were expecting. Between now and the end of the year, I think people are going to keep buying, with good earnings still coming in."

— Walter "Bucky" Hellwig, who helps manage $17 billion as senior vice president at BB&T Wealth Management

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