For investors, the healthcare debacle was just the warm-up act for the Trump administration production they really want to see: tax cuts.
Financial markets were mostly unfazed by Friday's well-foreshadowed collapse of the bill to repeal and replace Obamacare. But the failure of President Trump and congressional Republicans to push the legislation through the House spurred questions about whether they could achieve the equally complex task of overhauling the tax code.
Anticipation of those tax cuts are a big reason that investors have pushed stock prices up 12% since Trump's election. CEOs meeting with Trump at the White House often have publicly credited the expectation of lower taxes for new plans to hire and invest.
"It raises serious concern about the ability of Trump to achieve the rest of his agenda," said Gregory Valliere, chief global strategist at Horizon Investments. "I think it's going to be a very long wait for the financial markets to see something get done on taxes."
A tax overhaul is next up on the Republicans' agenda, Trump said Friday. And the administration has set an ambitious goal of getting it enacted by August.
"I would say that we will probably start going very, very strongly for the big tax cuts and tax reform. That will be next," Trump told reporters after House Republican leaders canceled Friday's late-afternoon vote on the healthcare bill because there wasn't enough support to pass it.
But House Speaker Paul D. Ryan (R-Wis.) said the bill's defeat made passing tax reform more difficult.
Under complex budget math, enacting the healthcare bill would have made it much easier to cut taxes by lowering the baseline against which deficits are measured by $1 trillion over the next 10 years
There are other difficulties in pushing tax legislation through Congress. Trump said in his joint address to Congress that his plan "would provide massive tax relief for the middle class." But an analysis by the Urban Institute and the Brookings Institution of the revised tax plan Trump campaigned on last fall found that the biggest cuts would go to high-income earners.
And House Republicans are pushing a controversial border adjustment tax that could hit consumers and some businesses hard.
Still, Ryan said he was optimistic.
"We have even more agreement on the need and nature of tax reform," Ryan said, adding that healthcare "had a big difference of opinion, not whether we should repeal and replace Obamacare but how to replace it."
John Lonski, chief economist at Moody's Capital Markets Research Group, said Republicans might try to rally around a tax bill to show the public that they can get things done in Washington now that they control the White House and Congress.
"It heightens the incentive to go ahead and make up for the damage they did to their image by not taking care of healthcare reform," he said.
But even so, the difficulties pulling on healthcare signaled to investors not to expect things to happen quickly in Washington, Lonski said.
"What we're finding out is that the Republicans have a lot of difficulty coming together on these issues and it might well be that the tax cuts also prove to be difficult to resolve," he said.
That would be bad news for investors and could stall the market rally that followed Trump's election.
Investors were so bullish that, in February, the Dow Jones industrial average set record highs for 12 consecutive trading sessions. All of which made the market due for some sort of a pullback, if only because prices had gotten rich relative to the stocks' underlying corporate profits.
"The markets got all jazzed up on this stuff moving quickly," Valliere said of Trump's agenda. "I thought all along things are glacial in this town and I think the markets got really ahead of themselves."
The Dow jumped 88 points Friday on initial reports of the healthcare bill's collapse, but then drifted lower. It ended the day down 59.86 points, or 0.3%, at 20,596.72. The Standard & Poor's 500 index was down just 0.08%. And the technology-heavy Nasdaq closed up 0.2%.
The muted reaction was partly because the legislation's troubles had been telegraphed in recent days. But it also reflects that the financial effects of healthcare reform were largely limited to insurers, hospitals and drugmakers.
Trump's pledge to slash the U.S. corporate tax rate — the highest among major economies — would help all companies. A special tax break to lure overseas profits back to the U.S. would help multinational companies. And accompanying cuts in personal income tax rates that Trump has also promised would boost consumer spending and help the overall economy, analysts said.
"If that failed, that would have a major impact on corporate profits right across the board," Valliere said of a tax overhaul.
Brad McMillan, chief investment officer of Commonwealth Financial Network, said in a note to clients this week that the healthcare bill was "really the first 'put up or shut up' moment of Trump's presidency."
"We now will find out whether meaningful change can really happen — or not," he said.
Earlier Friday, Treasury Secretary Steven Mnuchin reiterated the administration's August goal for tax reform.
"This is a big challenge but we're going to try to get it done in that period of time and if we don't, we'll get it done right afterwards," Mnuchin said at a Washington forum hosted by the Axios news website. "It's a big priority."
Mnuchin echoed Ryan in predicting that the tax overhaul would be easier than heathcare reform. But analysts aren't so sure.
House leaders are pushing for a border adjustment tax, which would subject importers to higher taxes than exporters or companies that produce products in the U.S. for domestic consumption.
Large companies that do a lot of exporting, such as the Boeing Co., want such a tax. Retailers that import a lot of goods, such as Wal-Mart Stores Inc., oppose it.
The administration has yet to take a position on the border adjustment tax. But Rep. Kevin Brady (R-Texas), chairman of the tax-writing House Ways and Means Committee, said after the healthcare bill died that the panel's Republicans "are moving full speed ahead with President Trump on the first pro-growth tax reform in a generation."
Investors shouldn't hold their breath, Valliere said.
"The details on this are almost as daunting as the details on healthcare," he said. "I don't think it can get done this year."
Follow @JimPuzzanghera on Twitter