Donald Trump has had a significant effect on stock and bond markets before even taking office. The billionaire will once again capture the spotlight during his inauguration on Friday but he is not the only figure in the incoming administration who will matter to financial markets.
Mr Trump has been filling key positions, including several that will command particular attention from investors unsure how his rhetoric on tax cuts, fiscal stimulus and deregulation will translate into policies. Here is a look at those who will matter most to markets once they are confirmed.
Steven Mnuchin: the Goldman Sachs alumnus in charge of the dollar
A former mortgage bond trader at Goldman Sachs, hedge fund manager and, more latterly, film producer, Mr Mnuchin will probably rank only behind Mr Trump in terms of importance for markets.
If confirmed, the nominee for Treasury secretary will have to manage the country’s debt and be responsible for working out how to finance his boss’s stimulus plans. Mr Mnuchin made waves in November by raising the possibility that the US could sell 50-year bonds for the first time.
An arguably even more delicate challenge for the 54-year-old will be managing the dollar, which has jumped to a 14-year high against a basket of its peers on expectations of faster US growth and higher interest rates. Unlike Mr Trump, Mr Mnuchin has remained tight-lipped about the currency. That could well change on Thursday, when he faces a confirmation hearing before the Senate finance committee.
Jay Clayton: the corporate lawyer heading to the SEC
The corporate lawyer’s confirmation hearing will draw a large audience on Wall Street. As head of the Securities and Exchange Commission, the veteran corporate lawyer will have a significant voice in everything from the regulation of exchange traded funds to rules for initial public offerings.
If confirmed by the Senate, Mr Clayton will play an important role in potentially taking apart the Dodd-Frank act, President Barack Obama’s flagship reform of the financial system following the 2008 crisis. Announcing his pick, Mr Trump signalled he wants more of an emphasis on the regulator creating a finance industry that will “thrive and create jobs”.
Mr Clayton, a partner at Sullivan & Cromwell, where clients have included Goldman Sachs, Barclays and Alibaba, has been a critic of the Foreign Corrupt Practices Act, so any developments on the anti-bribery law will be closely watched.
His picks to fill an array of senior division heads at the regulator will also be scrutinised by banks and asset managers hoping for a less punitive environment in the coming years.
CFTC chair: if not Christopher Giancarlo, then who?
The chairmanship of the Commodity Futures Trading Commission, which regulates the derivatives market in the US, will be one of the hottest administration jobs for markets.
Although Mr Trump has yet to announce his pick, Christopher Giancarlo, who has been a commissioner at the regulator since 2014, is considered the favourite. Mr Giancarlo caused a stir as soon as he arrived at the CFTC, publishing a white paper that lambasted reforms designed to shore up derivatives markets after the financial crisis. He will become interim chairman once the incumbent, Timothy Massad, leaves on Friday.
A former broker who headed financial services firm GFI Group, which made money from a business model now targeted by the new rules, Mr Giancarlo is expected to be supportive of regulatory amendments.
He is likely to be joined by new commissioners already nominated by Mr Obama. Christopher Brummer, a Georgetown University law professor, could fill the Democrat’s seat at the CFTC and Brian Quintenz, founder of Saeculum Capital Management, will probably fill the vacant Republican position. Who will take over as permanent chairman remains, for now, an open question.
Andrew Puzder: will the ‘fiduciary rule’ survive at the Department of Labor?
Mr Puzder is the chief executive of CKE Restaurants, owner of US fast-food chain Hardee’s, but is mostly known for his opposition to increasing the minimum wage. However, the question for those in the finance industry is what the incoming labour secretary’s position is on the so-called “fiduciary rule”.
The policy, passed by the Obama administration, is designed to curb conflicts of interest in the US pensions industry by imposing a higher fiduciary standard on financial advisers. It is scheduled to come into effect in April and several Trump advisers and the investment industry want to scrap the rule.
Wilbur Ross: commerce secretary
A billionaire known for his investments in distressed companies, Mr Ross is, as commerce secretary, expected to carry considerable sway over the administration’s trade policies.
He has known Mr Trump for a long time and was involved in restructuring a bankruptcy filing for the president-elect’s Taj Mahal casino when he worked for Rothschild. With a record of turning round companies, Mr Ross may be used as a sounding board by Mr Trump on broader economic policy.
Ben Carson: in charge of US housing policy
A former surgeon, who was on the receiving end of some ugly criticism from Mr Trump during the fight for the Republican nomination, Mr Carson is now the pick for the secretary of housing and urban development.
In that role, Mr Carson will be charged with managing the nation’s provision of public housing. Investors’ interest has been sharpened by his remarks that private companies should play a more prominent role in the mortgage market.
Mr Carson has even suggested that the government guarantee that currently exists for 30-year home loans could be replaced by one provided by private companies, which would be likely to push up the cost of long-maturity fixed-rate mortgages.
Carl Icahn: Trump’s regulations tsar
Given that part of the stock market’s recent rally has been fuelled by hopes of a lighter regulation environment for businesses, the utterances from Mr Icahn will be scrutinised. Perhaps best known to the wider public for his spats with rival billionaire investor Bill Ackman, Mr Icahn was an early Trump supporter, who provided economic advice during the election campaign.
Mr Trump has appointed him a special adviser on regulatory reform. Mr Icahn will be advising the president in an “individual capacity”, not as a federal employee, and so will not be subject to conflict of interest laws — something that has drawn criticism. Mr Icahn has rebuffed it, saying late last year that, “I’m not making any policy, I give my opinion. It doesn’t mean Donald is going to take my advice.”
Still, even having the ear of Mr Trump on such an important subject will ensure his utterances will be monitored by investors.
Peter Navarro: the economist and staunch critic of China
If his book The Coming China Wars and the 2012 documentary Death by China are anything to go by, University of California professor Mr Navarro — named director of trade and industrial policy in the Trump administration — could set up a bruising face-off with the Asian economy. Investors have mostly focused on the economic stimulus and regulatory rollback promised by the new government, but many remain concerned about the possibility of trade wars.
Robert Lighthizer: The China-critical trade lawyer
This will not be Mr Lighthizer’s first role in government, having served as a trade official under president Ronald Reagan. He now has the more senior role of US trade representative under Mr Trump, and will use his experience as a lawyer representing US steel producers in trade disputes to help enforce Mr Trump’s trade agreement plans.
The exact division of labour on trade issues is unclear, with a number of Mr Trump’s administration potentially taking on responsibilities. But Mr Lighthizer has in the past accused China of unfair trade practices, making him another administration official whom investors will scrutinise for hints of a protectionist tilt.
Mick Mulvaney: a fiscal hawk at the government’s budget office
The Republican Congressman of South Carolina is a founding member of the House’s fiscally conservative Freedom Caucus, and will head the Office of Management and Budget. Mr Trump has called Mr Mulvaney “a tremendous talent, especially when it comes to numbers and budgets”, but his fiscal rectitude — Mr Mulvaney was part of the Tea Party wave elected in 2010 — could see him clash with other members of the administration who want to unleash huge spending to stimulate the economy.