‘ Trump rally’: How does it stack up?
Rise of 5.8% since Election Day is the fifth best in history
While the euphoria surrounding the so- called “Trump rally” has gotten a lot of attention, the sizable stock market rally since Donald Trump’s presidential election win is stacking up as only the fifthbest honeymoon period ever.
Since Nov. 8, the large- company Standard & Poor’s 500 stock index has rallied 5.8%.
While that’s a robust return in 10 weeks’ time, it pales compared with the 13.3% gain after Republican Herbert Hoover’s 1928 election and his March 1929 inauguration, according to data compiled by investment firm Gluskin Sheff.
The only other U. S. presidents to enjoy bigger gains following their election wins and before taking office were Democrats Bill Clinton and John F. Kennedy and Republican Dwight Eisenhower.
Wall Street has reacted positively to Trump’s business- friendly agenda, which calls for tax cuts for corporations and fewer regulations on businesses. As a result, investors have been buying stocks in anticipation of what they believe will be a faster- growing economy, a better environment for businesses and more jobs.
But now comes the difficult part, as a rally built on hope now shifts to a market less interested in Trump’s policy proposals and more interested in which planks of his proposed plan, such as corporate tax reform and deregulation, are put into effect. The S& P 500, which post- election was up as much as 6.4% at its record close Jan. 6, has been under pressure, pulling back 0.6% in the past eight sessions as the rally entered a “show- me” phase.
“The hard part starts now,” says Jerry Braakman, chief investment officer at First American Trust. “Trump must shift from election politicking to actual implementation. That’s easier said than done.”