Why is a Pro-Business Court Ruling Eliciting Yawns on Wall Street?

One might think that Wall Street would react positively to a Supreme Court ruling that would effectively allow U.S. corporations to spend unlimited amounts for the political candidates of their choice.

But instead of rallying on the news yesterday, the Dow Industrials fell 213 points. Today, the Dow was off another 32 points in midday trading.

To be sure, the market yesterday was also hit by a piece of �negative news� � President Obama�s proposal to limit the size of big banks and their ability to make risky bets.

But shouldn�t investors be celebrating a landmark pro-business ruling like the one handed down by the high court?

�You are looking at a story that a lot of people on Wall Street aren�t thinking about right now,� says Art Hogan, the chief markets strategist with Jefferies & Co.

Critics of the high court ruling argue that it would shift the balance of political power sharply toward the interests of corporate America, essentially corrupting the democratic process.

President Obama called it �a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.�

Indeed, it�s easy to see how unlimited spending by corporations� would elect candidates in the coming years favorable to lower taxes and less government regulation. (Though the ruling would also give labor unions unlimited spending power in elections, corporations simply have more money to spend than the unions.)

Hogan agrees that corporate American, and investors in their shares, ought to be celebrating such a ruling. �It�s a positive for the S&P500,� he says.