As the lawmakers at congress failed to pass the new health care legislation, the financial market has taken a turn for the worse. Stocks declined, Yields moved lower, and the dollar weakened. As the doubts on the passing of the bill through the House of Representatives emerged over the last week, the US benchmark stock index declined from 2372 to 2346. Today, it is down another 0.7 percent in trading during Asian hours, as the rift between the White House and the congress deepen.

So, why is the market so worried about this health care bill, given the fact that the impact of this bill would be limited to certain sectors?

• It is being considered as a test for President Trump’s ability as a deal maker. In addition to that, it also being seen as a measure of unity within the Republican Party that controls the Senate, the House, and the White House.
• For seven years, the Republicans have been complaining about the existing health law signed by the former President Barrack Obama and have been preparing a bill that would correct the alleged flaws by replacing the old bill with a new one. If that faces a resistance within the party, the market is right to doubt that other more crucial promises made by President Trump could actually pass, at least in its original form.
• In addition to that, the recent rift between the White House and the Congress would only add to the difficulties of passing the upcoming tax reforms, budget proposals and increased infrastructure spending through congress.  

S&P 500 is currently trading at 2330 and we expect it to dip further towards 2280 before buyers emerge.