Trump's inauguration is about to take place. What should the market focus on the &#34;first day&#34;?
According to a report by CCTV News on Monday, Stephen Miller, a presidential assistant appointed by U.S. President-elect Trump, provided a list to Republican members of Congress, revealing some details of the executive orders Trump is expected to issue in the early days of his second term, including actions related to immigration, energy, and government structure. Trump is also expected to take a series of actions to revoke the executive orders of current President Biden.
Morgan Stanley stated in its latest report that the policy actions on Trump's first day in office will have a significant impact on the market, and it is expected that Trump will issue a large number of executive orders (possibly more than 100) on his first day, focusing on four policy areas: regulation, tariffs, immigration, and fiscal policy:
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1. Regulatory Policy:
It is expected that existing rules will be frozen and a &#34;re-regulation&#34; process will begin, particularly in the financial and energy sectors. Trump may use the Congressional Review Act (CRA) to overturn regulations recently issued by the Biden administration.
2. Tariff Policy:
The report analyzes possible tariff strategies, including a baseline scenario of quickly announcing but slowly implementing tariffs, as well as a possible accelerated implementation scenario.
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Baseline Scenario: It is expected that Trump will quickly announce tariff targets but will set a gradual implementation transition period for trade negotiations.
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Other Possible Paths: This includes implementing tariffs using the International Emergency Economic Powers Act (IEEPA) or ending permanent normal trade relations with trading partners through legislative means (such as the Restoring Trade Fairness Act).
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Market Impact: If the speed of tariff implementation exceeds market expectations, U.S. Treasury yields may rise, and the dollar may appreciate, especially against currencies like the Canadian dollar and Mexican peso. The current market has partially reflected the possibility of rapid tariff implementation, but if the actual situation exceeds expectations, the market will adjust further.
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3. Immigration Policy
It is expected that the &#34;zero tolerance&#34; policy will be restored, border enforcement will be strengthened, and deportation actions will be expanded.
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Border Enforcement: It is expected that border enforcement will be strengthened to reduce the number of illegal immigrants.
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Deportation Actions: It is expected that deportation actions will gradually increase, but congressional funding support will be needed.
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4. Fiscal Policy
Due to the limited unilateral power of the president in fiscal policy, it is expected that related actions will focus on congressional discussions on tax reform.
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Tax Reform: It is expected that Congress will pass a budget resolution later in 2025 to discuss the extension of the 2017 Tax Cuts and Jobs Act.
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Fiscal Deficit: The report expects that if tariffs increase, they may partially offset the expansion of the fiscal deficit, but the specific effect will depend on retaliatory measures from trading partners.
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In addition, as Republican congressional leaders interact with the media, there may be signals about the content and timing of legislative policies

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Morgan Stanley stated that there are two scenarios regarding tariffs: one is a baseline scenario where tariffs are announced quickly but implemented slowly, and the other is a possible accelerated implementation scenario. If the pace of tariff implementation exceeds market expectations, U.S. Treasury yields may rise, and the U.S. dollar may appreciate, especially against currencies such as the Canadian dollar and the Mexican peso

- The article discusses the anticipated market impacts of President Trump's inauguration and his expected executive actions on immigration, energy, and government structure.  
- Morgan Stanley predicts that Trump's first day will see over 100 executive orders focusing on regulation, tariffs, immigration, and fiscal policy, which could significantly influence market dynamics.  
- Key expected actions include freezing existing regulations, implementing tariffs, restoring strict immigration policies, and engaging in tax reform discussions in Congress, with potential effects on U.S. Treasury yields and the dollar's value.

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What should the market pay the most attention to on Trump's "first day"? This is Morgan Stanley's investor focus guide