When Donald Trump takes the oath of office later this week, he will inherit the second-longest stock bull run in history, and a market valued at a record $26 trillion.
From Wall Street’s point of view, it doesn’t often get much better than this. And that’s a big challenge for the new president.
The longevity of the current bull, and stocks’ high prices relative to company sales and earnings, have raised the stakes for what’s next. The Dow Jones industrial average, at 19,885, is up 8.9% just since election day — a sign of investors’ lofty expectations for the economy under Trump.
If he disappoints, or his tax, trade and spending policies trigger...