The stock market is expected to receive a significant boost from President-elect Donald Trump’s pro-business policies, according to Jeremy Siegel, a finance professor at the Wharton School of the University of Pennsylvania. Siegel believes that Trump is the most pro-stock market president in history and is unlikely to implement policies that would be detrimental to the stock market.
Following Trump’s election win, the market has already reached new heights as investors anticipate tax cuts and deregulation that will drive growth and benefit risk assets. The S&P 500 surged 4.66% last week, marking its best performance since November 2023 and trading above 6,000 for the first time ever. The Dow Jones Industrial Average also reached a new milestone of 44,000 post-election.
Notable investments that are expected to benefit greatly under a Trump presidency saw significant gains during the week. Tesla, whose CEO Elon Musk supports Trump, saw its shares soar by 29%, pushing its market cap back to $1 trillion. Bank stocks like JPMorgan Chase and Wells Fargo also experienced substantial rallies, while Bitcoin continued to reach record highs on expectations of looser regulations under Trump.
Siegel predicts that Trump’s corporate tax cuts from 2017 are likely to be extended, but expanding on other tax cuts may prove to be more challenging. However, Trump’s trade policy, particularly his threats to impose tariffs on trading partners, could potentially hinder growth and exacerbate inflationary pressures. This comes at a time when the Federal Reserve has been raising interest rates to combat rising prices.
In conclusion, Trump’s presidency is expected to have a significant impact on the stock market, with investors closely monitoring his policy decisions and their implications. The market’s reaction to Trump’s pro-business stance and promises of economic growth will continue to shape investment strategies in the coming months.
