The stock market has had a good run under Trump – but not historically large

The stock market has had a good run under Trump – but not historically large

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Between Trump’s inauguration in 2017 and Tuesday, his last full day in office, the S&P 500 (SPX), the broadest measure of the US stock market, climbed 67%.
Trump often announces market records Twitter (TWTR), sees them as the achievement of his administration.

“Now the stock market is actually significantly higher than before the pandemic,” Trump said in his inaugural speech on Wednesday.

He is right that stocks are currently trading in a record range, and therefore at a higher level than before the pandemic. However, the performance of the market over the course of its term was no record.

Under President Barack Obama, the S&P 500 rose 85% during its first term, reaching its peak in March 2009 during the financial crisis. During President Bill Clinton’s first term, the index climbed 79%.

Inventories initially rose when Trump was elected, as Corporate America focused on its pro-business agenda that includes tax cuts, deregulation and promises of spending on infrastructure.

The economy was also strong and this helped the boom in the market.

But then came the trends that were negative for equities: geopolitical concerns, including rising tensions with North Korea, and the trade war with China. The latter, in the midst of Trump’s term, dominated strategies’ view of US equities. But only with the pandemic did the longest bull market in history officially come to an end.

Under Joe Biden, who was sworn in as president on Wednesday, the stock market should take a less prominent place on the White House’s priority list.

“The idea that the stock market is thriving is his only measure of what is happening,” Biden said in the last presidential debate in October on Trump. “Where I come from in Scranton and Claymont, people do not live off the stock market.”

Over the summer, Trump said the market would ‘crumble’ if not re-elected, but the stock has climbed to a new high since Biden’s victory.
Analysts expect more profit for equities this year as the economy recovers after the downturn of the pandemic. Cyclical, consumer-driven businesses usually perform well during a recovery, and the promise of a large infrastructure plan can increase construction and manufacturing inventories.

On Wednesday, Biden’s first day in office, all three major U.S. stock indices closed the day at all times.

Biden has never made promises about how well the stock market will perform during his term, and that is unlikely to change now that he has been sworn in. But somehow he starts well.

– Matt Egan and Annalyn Kurtz of CNN contributed to this story.

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