Stocks gain on Trump policy bets; S&P breaks $20 trillion

Traders work on the floor of the New York Stock Exchange (NYSE) shortly after the opening bell in New York, U.S.,

By Chuck Mikolajczak

NEW YORK (Reuters) – A gauge of global equity stocks and markets advanced on Monday and bond yields rose as investors flocked to assets likely to benefit from reflationary policies that are expected to be implemented by U.S. President Donald Trump.

Financials and banks in particular led equities on Wall Street higher as investors bet Trump’s tax reform plans and softer regulatory environment will boost economic growth and corporate profits.

Comments from Trump on Thursday that he plans to announce what he said would be the most ambitious tax reform plan since the Reagan era in the next few weeks rekindled hopes for big tax cuts while the announced resignation of the Fed’s top bank regulator on Friday heightened expectations for a loosening of rules on banks.

“Investors are willing to say the prospects for growth are higher now than they were, and they’re not just saying it, they’re committing capital,” said Jamie Cox, managing partner of Harris Financial Group in Richmond Virginia.

Investors were also encouraged by a U.S.-Japan summit over the weekend apparently having ended smoothly without Trump talking tough on trade, currency or security issues.

In addition, Trump said on Monday the United States will be “tweaking” its trade relationship with Canada, stopping short of calling for a major realignment in a development likely to please visiting Canadian Prime Minister Justin Trudeau.

The Dow Jones Industrial Average rose 142.79 points, or 0.7 percent, to end at 20,412.16, the S&P 500 gained 12.15 points, or 0.52 percent, to 2,328.25 and the Nasdaq Composite added 29.83 points, or 0.52 percent, to 5,763.96.

The advance put the S&P 500’s market capitalization above the $20 trillion mark for the first time. Apple the largest component of the S&P 500 and a core holding on Wall Street, climbed 0.9 percent to a record $133.29, breaking its prior closing high of $133.00 set on Feb. 23, 2015 and giving it a market value of about $699.3 billion.

MSCI’s all-country world index advanced 0.49 percent to notch its fourth straight advance. Europe’s broad FTSEurofirst 300 index gained 0.76 percent to close at its highest since December 2015.

U.S. Treasury yields rose as investors looked to testimony by Federal Reserve Chair Janet Yellen on Tuesday and Wednesday when she gives her semiannual Humphrey Hawkins testimony before lawmakers in Washington.

Benchmark 10-year notes declined 7/32 in price to yield 2.43 percent, up from 2.41 percent late on Friday.

The dollar was up 0.18 percent against a basket of major currencies, after touching its highest in almost three weeks, on expectations reflationary policies would stoke economic growth and the possibility the Fed could be more aggressive in hiking interest rates.

In commodities, copper hit its highest since May 2015 after shipments from Chile and Indonesia, the world’s two biggest copper mines, were disrupted.

The metal last traded at $6,105.85 per tonne, up 0.26 percent on the day after climbing as high as $6,204. On Friday it jumped more than 4 percent, its biggest one-day rise in almost four years.

Oil prices pulled back from strong gains registered on Friday as the greenback strengthened and signs of rising U.S. crude output pressured prices.

International benchmark Brent crude futures settled down 2 percent at $55.59 per barrel and U.S. crude settled 1.7 percent lower at $52.93.

(Additional reporting by Noel Randewich; Editing by Nick Zieminski and James Dalgleish)

Netanyahu opposes Palestinian state, Israeli minister says ahead of U.S. visit

Israeli Prime Minister Benjamin Netanyahu (R) stands next to Republican U.S. presidential candidate Donald Trump during their meeting in New York, U.S.

By Jeffrey Heller

JERUSALEM (Reuters) – Benjamin Netanyahu opposes a Palestinian state, a senior Israeli cabinet member said on Monday, but left it unclear whether the prime minister would say that publicly in talks with U.S. President Donald Trump in Washington this week.

Netanyahu has never explicitly abandoned his conditional support for a future Palestine, and his spokesman did not respond immediately to a request to comment on Public Security Minister Gilad Erdan’s remarks.

Erdan belongs to Netanyahu’s right-wing Likud party, whose leading members have often espoused a harder line than the prime minister himself.

“I think all members of the security cabinet, and foremost the prime minister, oppose a Palestinian state,” Erdan told Army Radio after the forum met on Sunday on the eve of Netanyahu’s departure for Washington for talks with Trump on Wednesday.

“No one thinks in the next few years that a Palestinian state is something that, God forbid, might or should happen,” he said in the interview.

But asked if Netanyahu would voice opposition to statehood on camera when he meets Trump, Erdan said: “The prime minister has to weigh things according to what he feels in the meeting and the positions he encounters there. No one knows what the positions of the president and his staff are.”

Palestinians seek to establish a state in the occupied West Bank and the Gaza Strip with East Jerusalem as its capital. Israel captured those areas in a 1967 war and pulled its troops and settlers out of Gaza in 2005.

NUANCED

Citing Israeli settlement activity, Palestinian leaders and the former U.S. administration of Barack Obama have questioned Netanyahu’s commitment, which he first made in a 2009 policy speech, to the so-called two-state solution to decades of conflict.

“It is not only their statements – what the government of the extreme right in Israel does on the ground prevents any chance of the establishment of a Palestinian state,” Wasel Abu Youssef, an official of the Palestine Liberation Organization, said of Erdan’s comments.

Since Trump took office last month, Netanyahu has approved construction of 6,000 settler homes in the West Bank and East Jerusalem, drawing international condemnation which the White House did not join.

In recent days, however, the Trump administration has taken a more nuanced position, saying building new settlements or expanding existing ones may not be helpful in achieving peace.

Netanyahu has spelled out terms for a future Palestine: its demilitarization, the stationing of Israeli troops in its territory and Palestinian recognition of Israel as the “nation-state” of the Jewish people.

Last month, Israel’s Haaretz newspaper said Netanyahu, in a closed-door meeting with Likud ministers, coined a new term “Palestinian state-minus” to describe his vision of limited Palestinian sovereignty.

Under interim peace deals, Palestinians, who number about 2.5 million in the West Bank, currently exercise limited self-rule in the territory, where some 350,000 Israeli settlers live.

Some members of Netanyahu’s government have called for the annexation of parts of the West Bank, a demand he has resisted.

(Additional reporting by Nidal al-Mughrabi in Gaza; Editing by Maayan Lubell and Janet Lawrence)

After Court rejection, Trump says Nation’s Security at stake

The James R. Browning U.S. Court of Appeals Building, home of the 9th U.S. Circuit Court of Appeals

By Dan Levine and Mica Rosenberg

(Reuters) – U.S. President Donald Trump suffered a legal blow on Thursday when a federal appeals court refused to reinstate a temporary travel ban he had ordered on people from seven Muslim-majority countries.

A three-judge panel of the 9th U.S. Circuit Court of Appeals unanimously ruled that the Trump administration failed to offer any evidence that national security concerns justified immediately restoring the ban, which he launched two weeks ago.

Shortly after the court issued its 29-page ruling, Trump tweeted: “SEE YOU IN COURT, THE SECURITY OF OUR NATION IS AT STAKE!” He told reporters his administration ultimately would win the case and dismissed the ruling as “political.”

The 9th Circuit ruling, upholding last Friday’s decision by U.S. District Judge James Robart, does not resolve the lawsuit. It relates only to whether to lift an emergency halt to Trump’s order put in place by a lower court.

The judges said more briefing would be needed to decide the actual fate of Trump’s order.

The Justice Department, which spoke for the administration at oral argument on Tuesday, said it was reviewing the decision and considering its options.

The states of Washington and Minnesota challenged Trump’s order, which had sparked protests and chaos at U.S. and overseas airports on the weekend after it was issued. The two states argued that Trump’s ban violated constitutional protections against religious discrimination.

Asked about Trump’s tweet, Washington state Attorney General  Bob Ferguson said: “We have seen him in court twice, and we’re two for two.”

While the court said it could not decide whether the order discriminated against a particular religion until the case had been “fully briefed,” it added that the states had presented evidence of “numerous statements” by the president “about his intent to implement a ‘Muslim ban.’”

The court said the government had failed to show that any person from the seven countries had perpetrated a terrorist attack in the United States.

The administration argued that the courts do not have access to the same classified information about threats to the country that the president does. The judges countered that “courts regularly receive classified information under seal.”

Trump’s Jan. 27 executive order barred entry for citizens from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen for 90 days and imposed a 120-day halt on all refugees, except refugees from Syria who are barred indefinitely.

The three judges said the states had shown that even temporary reinstatement of the ban would cause harm.

FINAL OUTCOME ‘NOT CERTAIN’

Curbing entry to the United States as a national security measure was a central premise of Trump’s 2016 presidential campaign, originally proposed as a temporary ban on all Muslims. He has voiced frustration at the legal challenge to his order.

U.S. presidents have in the past claimed sweeping powers to fight terrorism, but individuals, states and civil rights groups challenging the ban said his administration had offered no evidence it answered a threat.

Two of the three 9th Circuit judges were appointees of former Democratic Presidents Jimmy Carter and Barack Obama, and one was appointed by former President George W. Bush, a Republican like Trump.

The government could ask the 9th Circuit to have a larger panel of judges review the decision “en banc,” or appeal directly to the U.S. Supreme Court, which will likely determine the case’s final outcome.

Senior White House adviser Kellyanne Conway told Fox News: “It’s an interim ruling and we’re fully confident that now that we will get our day in court and have an opportunity to argue this on the merits we will prevail.”

Asked if the administration would go to the Supreme Court, she said: “I can’t comment on that. … He will be conferring with the lawyers and make that decision.”

If the Trump administration appeals to the Supreme Court, it would need five of the eight justices to vote in favor of a stay blocking the district court injunction. That is likely to be a tall order as the court is evenly divided 4-4 between liberals and conservatives, meaning the administration would need to win over at least one of the liberal justices.

The Council on American-Islamic Relations, the nation’s largest Muslim civil rights and advocacy organization, said in a statement: “This victory should not lead to complacency. This and other Trump administration orders and policies still pose a threat to communities of color, religious minorities, women, and others.”

Democrats, the minority party in Congress, celebrated.

House Democratic leader Nancy Pelosi said in an email statement: “This Administration’s recklessness has already done significant harm to families, and undermined our fight against terror. For the sake of our values and the security of America, Democrats will continue to press for President Trump’s dangerous and unconstitutional ban to be withdrawn.”

But Tom Fitton from the conservative group Judicial Watch said on Twitter: “The Ninth Circuit ruling is a dangerous example of judicial overreach.”

(Reporting by Dan Levine in San Francisco and Noeleen Walder and Mica Rosenberg in New York; Writing by Lisa Lambert and Howard Goller; Editing by Peter Cooney)

Pence breaks Senate tie to confirm DeVos as education secretary

Betsy DeVos testifies before the Senate Health, Education and Labor Committee confirmation hearing to be next Secretary of Education o

WASHINGTON (Reuters) – President Donald Trump’s choice of billionaire Betsy DeVos to be education secretary was confirmed by the U.S. Senate on Tuesday, but only after Vice President Mike Pence was called in to break a tie that threatened to defeat her.

The tie-breaking vote, which Senate officials said was unprecedented to confirm a president’s Cabinet nominee, came after two Republicans joined with 46 Democrats and two independents in opposition to DeVos. Critics have called her unprepared to lead the Department of Education.

(Reporting by Rick Cowan; Editing by Frances Kerry)

Merkel: Fighting terrorism a top priority for Trump’s new U.S. government

German Chancellor Angela Merkel speaks during a joint news conference with Turkish Prime Minister Binali Yildirim at the first visit since July's failed coup in Ankara, Turkey,

ANKARA (Reuters) – German Chancellor Angela Merkel said on Thursday that the administration of U.S. President Donald Trump seemed to be making the fight against international terrorism a top priority.

Citing her conversation with Trump on Saturday and what she had read, she said there was a lot of continuity between the old and new U.S. governments in this regard.

Merkel said during a visit to Ankara that she had open and frank discussions with Turkish President Tayyip Erdogan and Prime Minister Binali Yildirim on a series of controversial issues, including Turkey’s bid to join the European Union.

She said she had stressed that German authorities were taking action against the Kurdistan Workers Party (PKK) and called for the German and Turkish interior ministries to increase their cooperation on that issue.

(Reporting by Reuters TV; Writing by Andrea Shalal; Editing by Michelle Martin)

Trump says his travel ban needed to ensure U.S. religious freedom

DAY 9 / JANUARY 28: Russian President Vladimir Putin and President Trump agreed to try to rebuild U.S.-Russia ties and to cooperate in Syria, the Kremlin said, after the two men spoke for the first time since Trump's inauguration.

By Jeff Mason and Roberta Rampton

WASHINGTON (Reuters) – U.S. President Donald Trump defended his order to temporarily bar entry to people from seven majority-Muslim nations, which has come under intense criticism at home and abroad, saying on Thursday it was crucial to ensuring religious freedom and tolerance in America.

Trump, speaking at a prayer breakfast attended by politicians, faith leaders and guests including Jordan’s King Abdullah, said he wanted to prevent a “beachhead of intolerance” from spreading in the United States.

“The world is in trouble, but we’re going to straighten it out, OK? That’s what I do – I fix things,” Trump said in his speech.

Trump’s executive order a week ago put a 120-day halt on the U.S. refugee program, barred Syrian refugees indefinitely and imposed a 90-day suspension on people from seven predominantly Muslim countries – Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen. The measure, which Trump says is aimed at protecting the country from terrorist attacks, has drawn protests and legal challenges.

Trump, a wealthy businessman and former reality TV star who had never previously held public office when he was sworn in on Jan. 20, also sought to reassure the large crowd about the nature of his phone calls with world leaders.

The Washington Post said Trump had a tense call with Australia’s Prime Minister about his immigration order.

“Believe me, when you hear about the tough phone calls I’m having – don’t worry about it. Just don’t worry about it,” Trump said. He did not specify which calls he was referring to.

“We’re taken advantage of by every nation in the world virtually. It’s not going to happen anymore,” said Trump, who campaigned on a stance of “America first” that he said would ensure the country was not taken advantage of in its trade or other foreign relations.

Trump said violence against religious minorities must end. “All nations have a moral obligation to speak out against such violence. All nations have a duty to work together to confront it, and to confront it viciously, if we have to,” he said.

Trump said the United States has taken “necessary action” in recent days to protect religious liberty in the United States, referring to his immigration action.

Critics of the measure have accused him of violating the constitutional guarantee of religious freedom, because the designated countries are majority-Muslim, and of slamming the door shut to refugees.

Trump has said the move was necessary to ensure a more thorough vetting of people coming into the United States.

“Our nation has the most generous immigration system in the world. There are those who would exploit that generosity to undermine the values that we hold so dear,” Trump said.

“There are those who would seek to enter our country for the purpose of spreading violence, or oppressing other people based upon their faith or their lifestyle – not right. We will not allow a beachhead of intolerance to spread in our nation,” he said.

Trump said his administration’s new system would ensure that people entering the United States embrace U.S. values including religious liberty.

He also pledged to get rid of the “Johnson Amendment,” a tax provision that prevents tax-exempt charities like churches from being involved in political campaigns.

The White House said on Wednesday it has issued updated guidance on the travel order clarifying that legal permanent residents, or green card holders, from the designated countries require no waiver to enter the United States.

(Writing by Roberta Rampton; Editing by Chizu Nomiyama and Frances Kerry)

Trump threatens U.C. Berkeley after protests stop far-right speech

A worker surveys the damage to a vandalized Starbucks after a student protest turned violent at UC Berkeley during a demonstration over right-wing speaker Milo Yiannopoulos, who was forced to cancel his talk, in Berkeley, California.

By David Ingram

(Reuters) – U.S. President Donald Trump threatened on Thursday to cut funding to the University of California at Berkeley after protesters smashed windows and set fires at the liberal-leaning school, forcing the cancellation of an appearance by a far-right Breitbart News editor.

“If U.C. Berkeley does not allow free speech and practices violence on innocent people with a different point of view – NO FEDERAL FUNDS?” Trump wrote on Twitter at 6:13 a.m. EST (1113 GMT). He did not elaborate.

Representatives for the university, which has 38,000 students and a long history of activism, could not immediately be reached for comment outside of the school’s business hours.

Like other major U.S. research universities, Berkeley depends on federal agencies for scientific grants and other support. It was not immediately clear, however, what action Trump could take without authorization from Congress, or without risking legal action.

Trump’s chief White House strategist, Steve Bannon, previously headed Breitbart News.

Hours before Breitbart’s Milo Yiannopoulos was to give a speech at Berkeley’s student union on Wednesday, hundreds of protesters clashed with police at the campus.

Demonstrators tossed metal barricades and rocks through the building’s windows and set a generator on fire near the entrance, footage from news outlets showed. Police ordered the crowds to disperse, and the school was put on lockdown.

“We shut down the event,” one protester told CNN. “It was great. Mission accomplished.”

In a statement, the university blamed about 150 “masked agitators” for the violence during the otherwise mostly peaceful demonstration by about 1,500 people.

The school “is proud of its history and legacy as home of the free speech movement” in the 1960s, the statement said.

Many of the protesters voiced opposition to Trump, CNN reported. The president’s executive orders and proposed policies, including his suspension of the U.S. refugee program and temporary ban on travelers from seven Muslim-majority countries, have triggered largely peaceful demonstrations by tens of thousands of people across the United States.

Yiannopoulos, whose Twitter account was suspended last year after he was accused of participating in the online harassment of a black actor, told Fox News he was rushed to safety by his security guards and police after protesters began throwing rocks.

“Obviously it’s a liberal campus so they hate any libertarians or conservatives who dare to express an opinion on their campuses,” he said. “They particularly don’t like me.”

(Additional reporting by Alex Dobuzinskis in Los Angeles and Brendan O’Brien in Milwaukee; Editing by Daniel Wallis and Lisa Von Ahn)

Israel wraps up illegal outpost evacuation, promises new settlement

An Israeli settler touches the floor of a synagogue after it was evacuated during the second day of an operation by Israeli forces to evict the illegal outpost of Amona in the occupied West Bank

By Rami Amichay

AMONA, West Bank (Reuters) – Israeli police dragged nationalist youths out of a barricaded synagogue on Thursday, completing the forced evacuation of an illegal outpost in the West Bank even as Prime Minister Benjamin Netanyahu promised to build evicted families a new settlement.

Some 100 youngsters protesting against the removal of some 300 settlers from Amona, an outpost built without Israeli government authorization, kicked at police who used a high-pressure hose and a wooden pole to batter down sheet metal and furniture blocking the entrances to the synagogue.

The teenagers painted a Nazi swastika on a synagogue wall next to a slogan denouncing the police.

The evacuation began on Wednesday, when most of the families that settled in Amona were removed. But the youths holed up in the synagogue overnight.

Police, announcing that Amona had been cleared, said some 60 officers were slightly hurt in the two-day operation. Hospitals reported that at least four protesters had been treated for injuries.

Amona, built in 1995, was the largest of scores of outposts erected in the West Bank without formal approval. Israel’s Supreme Court ruled last November that it must be evacuated because it stands on privately-owned Palestinian land.

NETANYAHU PLEDGE

In a statement late on Wednesday and again in a speech in the West Bank on Thursday, Netanyahu said a new settlement would be built for Amona’s families and that a committee would be set up to locate a site.

“We will work to have it happen as soon as possible,” he said, speaking in the West Bank settlement of Ariel.

Once constructed, it will be the first new settlement built in the West Bank since 1999. Construction in existing settlements has raised to 350,000 the number of Israelis living in the territory, which was captured in the 1967 Middle East war. Another 200,000 Israelis live in East Jerusalem, also seized in that conflict.

Most countries consider all Israeli settlements to be illegal. Israel disagrees, citing historical and political links to the land – which the Palestinians also assert – as well as security interests.

Since Donald Trump took office as U.S. president on Jan. 20, Israel has announced plans for almost 6,000 more settlement homes in the West Bank, drawing European and Palestinian condemnation but no criticism from the White House.

Trump, a Republican, has signaled he could be more accommodating toward settlements than his Democratic predecessor Barack Obama.

Palestinians want to establish a state in the West Bank and in the Gaza Strip, which Israeli forces and settlers left in 2005, with East Jerusalem as its capital.

(Writing by Ori Lewis; Editing by Gareth Jones)

Trump adopts aggressive posture toward Iran after missile launch

A file photo shows a ballistic missile launched and tested at an undisclosed location in Iran. REUTERS/Mahmood

By Steve Holland and Matt Spetalnick

WASHINGTON (Reuters) – The White House put Iran “on notice” on Wednesday for test-firing a ballistic missile and said it was reviewing how to respond, taking an aggressive posture toward Tehran that could raise tensions in the region.

While the exact implications of the U.S. threat were unclear, the new administration signaled that President Donald Trump intended to do more, possibly including imposing new sanctions, to curb what he sees as defiance of a nuclear deal negotiated in 2015 by then-President Barack Obama.

The tough talk commits the administration to back up its rhetoric with action, which could cast doubt on the future of the Iran agreement and sow further uncertainty in an already chaotic Middle East, experts said.

Trump has frequently criticized the Iran nuclear deal, calling the agreement weak and ineffective.

Officials declined to say whether the military option was on the table, although Pentagon spokesman Christopher Sherwood said: “The U.S. military has not changed its posture in response to the Iranian test missile launch” on Sunday.

A fiery statement from Trump’s national security adviser, Michael Flynn, marked some of the most aggressive rhetoric by the administration that took office on Jan. 20, making clear that Obama’s less confrontational approach toward Iran was over.

Flynn said that instead of being thankful to the United States for the nuclear deal, “Iran is now feeling emboldened.”

“As of today, we are officially putting Iran on notice,” he told reporters in his first appearance in the White House press briefing room.

He said the launch and an attack on Monday against a Saudi naval vessel by Iran-allied Houthi militants off the coast of Yemen underscored “Iran’s destabilizing behavior across the Middle East.”

Iran confirmed it had tested a new missile but said it did not breach a nuclear accord reached with world powers or a U.N. Security Council resolution that endorsed the pact.

‘HOW WOULD U.S. RESPOND?’

Analysts said Iran could interpret Flynn’s warning as bluster given that the Trump administration is still formulating a response.

“It’s a vague way of drawing a line in the sand,” said Mark Fitzpatrick, executive director of the International Institute for Strategic Studies-Americas. “Taken literally, it could mean: ‘You do this one more time and you’ll pay for it.’ But how would the U.S. respond?”

The warning could foreshadow more aggressive economic and diplomatic measures against Iran.

Three senior U.S. officials, speaking on condition of anonymity, said a range of options, including economic sanctions, was being considered and that a broad review was being conducted of the U.S. posture toward Iran.

One official said the intent of Flynn’s message was to make clear the administration would not be “shy or reticent” toward Tehran.

“We are in the process of evaluating the strategic options and the framework for how we want to approach these issues,” the official said. “We do not want to be premature or rash or take any action that would foreclose options or unnecessarily contribute to a negative response.”

“Our sincere hope is that the Iranians will heed this notice today and will change their behavior,” he said.

Iran has test-fired several ballistic missiles since the nuclear deal in 2015, but the latest test was the first since Trump became president.

RISK OF MISCALCULATION

The issue came to the forefront on the same day that the U.S. Senate confirmed former Exxon Mobil Corp Chief Executive Rex Tillerson as secretary of state.

Trump told Tillerson at his swearing-in ceremony that “although you inherit enormous challenges in the Middle East and around the world, I believe we can achieve peace and security in these very, very troubled times.”

Simon Henderson, a Gulf expert at the Washington Institute for Near East Policy, said there was a danger of a miscalculation by Washington or Tehran.

“The question now is will the Iranian logic be: ‘My goodness, this guy is serious, we’d better behave ourselves?’” he said. “Or do they say: ‘Why don’t we tweak him a bit more to see what he really means, maybe test him.’”

The administration’s tough statement came midway through a three-day exercise by 18 U.S., French, British and Australian warships and an undisclosed number of aircraft close to Iranian waters in the Gulf, according to a statement by U.S. Central Command.

Trump is due to hold talks with Israeli Prime Minister Benjamin Netanyahu, a strident critic of the Iran nuclear deal, at the White House on February 15.

The U.S. president and Saudi Arabia’s ruler, King Salman, spoke by phone on Sunday and were described by the White House as agreeing on the importance of enforcing the deal and “addressing Iran’s destabilizing regional activities.”

Sunni Muslim-dominated Saudi Arabia, home to Mecca and other Islamic holy sites, and Shi’ite Muslim-majority Iran are regional rivals.

(Additional reporting by Jonathan S. Landay, Roberta Rampton, Idrees Ali, Yeganeh Torbati, Lesley Wroughton, Yara Bayoumy and Arshad Mohammed; Editing by Jonathan Oatis and Peter Cooney)

Trump picks conservative judge Gorsuch for U.S. Supreme Court

By Lawrence Hurley and Steve Holland

WASHINGTON (Reuters) – President Donald Trump on Tuesday nominated Neil Gorsuch for a lifetime job on the U.S. Supreme Court, picking the 49-year-old federal appeals court judge to restore the court’s conservative majority and help shape rulings on divisive issues such as abortion, gun control, the death penalty and religious rights.

The Colorado native faces a potentially contentious confirmation battle in the U.S. Senate after Republicans last year refused to consider Democratic President Barack Obama’s nominee to fill the vacancy caused by the February 2016 death of conservative justice Antonin Scalia.

Gorsuch is the youngest nominee to the nation’s highest court in more than a quarter century, and he could influence the direction of the court for decades.

Announcing the selection at the White House flanked by the judge and his wife, Trump said Gorsuch’s resume is “as good as it gets.” Trump said he hopes Republicans and Democrats can come together on this nomination for the good of the country.

“Judge Gorsuch has outstanding legal skills, a brilliant mind, tremendous disciple, and has earned bipartisan support,” Trump said.

“Depending on their age, a justice can be active for 50 years. And his or her decisions can last a century or more, and can often be permanent,” Trump added.

Gorsuch is a judge on the Denver-based 10th U.S. Circuit Court of Appeals and was appointed to that post by Republican President George W. Bush in 2006.

Some Democrats in the U.S. Senate, which votes on whether to confirm judicial nominees, have already said they would seek to block whoever Trump nominates.

Gorsuch is considered a conservative intellectual, known for backing religious rights, and is seen as very much in the mold of Scalia, a leading conservative voice on the court for decades.

“I respect … the fact that in our legal order it is for Congress and not the courts to write new laws,” Gorsuch said, as Trump looked on. “It is the role of judges to apply, not alter, the work of the people’s representatives. A judge who likes every outcome he reaches is very likely a bad judge, stretching for results he prefers rather than those the law demands.”

A senior administration official, speaking on condition of anonymity, said the choice of Gorsuch was seen by the White House as a significant departure from Supreme Court nominations from the recent past, given that many justices have come from the eastern United States. Gorsuch lives in Boulder, Colorado, where he raises horses and is a life-long outdoorsman.

The official described Gorsuch as a mainstream judge who should easily be confirmed by the Senate. The official noted that the Senate confirmed him for his current judgeship in 2006 by voice vote with no one voting against him.

Democratic Senator Patrick Leahy said that “the Senate owes the American people a thorough and unsparing examination of this nomination,” saying Trump “outsourced this process to far-right interest groups.”

The liberal advocacy group People for the American Way immediately opposed the nomination, with its president, Michael Keegan, describing Gorsuch as an “ideological warrior who puts his own right-wing politics above the Constitution.”

The administration official said the White House feels Gorsuch has the qualities that Democratic senators said they wanted to see in a justice during visits with senior Trump officials about filling the vacancy.

“He plays it straight. He sticks to principles, and his opinions reflect a consistency regardless of who is in his courtroom,” the official said of Gorsuch.

Trump made his choice between two U.S. appeals court judges, Gorsuch and Thomas Hardiman of the Philadelphia-based 3rd U.S. Circuit Court of Appeals, according to a source involved in the selection process.

Gorsuch became the youngest U.S. Supreme Court nominee since Republican President George H.W. Bush in 1991 selected conservative Clarence Thomas, who was 43 at the time.

He is the son of Anne Burford, the first woman to head the U.S. Environmental Protection Agency. She served in Republican President Ronald Reagan’s administration but resigned in 1983 amid a fight with Congress over documents on the EPA’s use of a fund created to clean up toxic waste dumps nationwide.

Trump’s selection was one of the most consequential appointments of his young presidency as he moved to restore a conservative majority on the Supreme Court that had been in place for decades until Scalia died at age 79 on Feb. 13, 2016.

Trump, who took office on Jan. 20, got the opportunity to name Scalia’s replacement only because the Republican-led U.S. Senate, in an action with little precedent in U.S. history, refused to consider Obama’s nominee for the post, appeals court judge Merrick Garland. Obama nominated Garland on March 16 but Republican senators led by Majority Leader Mitch McConnell denied Garland the customary confirmation hearings and vote.

Trump has said his promise to appoint a conservative justice was one of the reasons he won the Nov. 8 presidential election, with Christian conservatives and others emphasizing the importance of the pick during the campaign. Trump last week said evangelical Christians would love his nominee.

Trump’s fellow Republicans hold a 52-48 majority in the Senate. The minority Democrats, irate over Garland’s rebuff, potentially could try to block the nomination with procedural hurdles.

The new appointee would expand the court’s conservative wing, made up of John Roberts, Anthony Kennedy, Clarence Thomas and Samuel Alito. Kennedy long has been considered the court’s pivotal vote, sometimes siding with the liberals in key cases such as the June 2016 ruling striking down abortion restrictions in Texas.

The court’s restored conservative majority likely would be supportive toward the death penalty and gun rights and hostile toward campaign finance limits. Scalia’s replacement also could be pivotal in cases involving abortion, religious rights, presidential powers, transgender rights, voting rights, federal regulations others.

Gorsuch has strong academic qualifications, with an Ivy League education: attending Columbia University and, like several of the other justices on the court, Harvard Law School. He also completed a doctorate in legal philosophy at Oxford University, spent several years in private practice and worked in George W. Bush’s Justice Department.

Gorsuch joined an opinion in 2013 saying that owners of private companies could object on religious grounds to a provision of the Obamacare health insurance law requiring employers to provide coverage for birth control for women.

As long as Kennedy and four liberals remain on the bench, the court is not expected to pare back abortion rights as many U.S. conservatives fervently hope. The Supreme Court legalized abortion in the landmark 1973 Roe v. Wade ruling. In June, the justices ruled 5-3 to strike down a Texas law that restricted abortion access, with Kennedy and the liberals in the majority.

The current vacancy is the court’s longest since a 391-day void from 1969 to 1970 during Republican Richard Nixon’s presidency. After Abe Fortas resigned from the court in May 1969, the Senate voted down two nominees put forward by Nixon before confirming Harry Blackmun, who became a justice in June 1970. Aside from that one, no other Supreme Court vacancy since the U.S. Civil War years of the 1860s has been as long as the current one.

Some Democrats have threatened to pursue a procedural hurdle called a filibuster, meaning 60 votes would be needed in the 100-seat Senate unless its long-standing rules are changed. Trump’s fellow Republicans hold a 52-48 majority, meaning some Democratic votes would be needed to confirm his pick.

Trump said last week he would favor Senate Republicans eliminating the filibuster, a change dubbed the “nuclear option,” for Supreme Court nominees if Democrats block his pick.

Trump during his presidency may get to make additional appointments to the Supreme Court. Liberal Ruth Bader Ginsburg, who Trump called upon to resign last July after she called him “a faker,” is 83 while Kennedy is 80. Stephen Breyer, another liberal, is 78.

If any of those three is replaced by a Trump appointee, conservatives would be eager to bring cases challenging the Roe v. Wade ruling in the hope it would be overturned, long a goal for many Christian conservatives.

(Additional reporting by Andrew Chung, Richard Cowan, Susan Heavey, Ayesha Rascoe and Doina Chiacu; Writing by Alistair Bell and Will Dunham; Editing by Bill Trott and Peter Cooney)