By Graham Summers, MBA | Chief Market Strategist
Let’s grab a cup of coffee and talk about something that’s intrigued many of us over the past few years – Donald Trump’s impact on the stock market.
Whether you loved him, hated him, or found yourself somewhere in between, it’s undeniable that Trump’s presidency had a significant impact on the markets. And as investors, our goal is on making money, NOT choosing political sides. So, let’s break down how and why this happened, without getting caught in the political weeds.
Let’s start with Trump’s 2016 policies, and what they meant for stocks…
Key Policies and Their Impacts
Corporate Tax Cuts:
One of the cornerstone policies of Trump’s administration was the Tax Cuts and Jobs Act of 2017. This piece of legislation slashed the corporate tax rate from 35% to 21%. Lower taxes meant higher net profits for companies, and subsequently, higher dividends for shareholders. This injection of optimism contributed to a bullish market.
Deregulation:
Trump’s administration took significant steps to roll back regulations, particularly in the financial and energy sectors. By reducing regulatory burdens, companies found it easier to do business and increase profitability. As a result, the market reacted positively, favoring sectors directly impacted by deregulation.
Trade Policies and Tariffs:
Perhaps the most contentious aspect of Trump’s economic policy was his approach to trade, particularly with China. The imposition of tariffs led to increased costs for businesses reliant on global supply chains and created uncertainty in the markets. However, many investors saw these moves as part of a broader strategy to level the playing field for American businesses.
Add it all up, and this mix of lower taxes, lower regulatory burden, and America-first dynamics were a boon for corporate profits, which drive stocks. The market roared higher during Trump’s 1st term. Even when the pandemic hit, Trump’s combination of aggressive stimulus along with the Fed’s extraordinary actions resulted in a rapid recovery.
Stocks finished Trump’s term up over 85% for average annual gains of over 20%. This was an EXTRAORDINARY period to be a stock investor.
Now Donald Trump is President once again. And by the look of things, he’s going to be even more stock market obsessed with a specific focus on controlling the Fed top insure stocks go higher.
This is going to have a profound impact on the economy and stock markets.
For those investors looking for specific investment strategies to profit from Trump’s 2nd term, we just released a Special Investment Report detailing what we consider to be the #1 investment to own during Trump’s 2nd Term. It rose 2,000% during his first term… and it’s already up 32% since election night!
We are selling this report as a standalone item for $499… but you can pick up a copy FREE simply by joining our daily market commentary, Gains Pains & Capital.
We are making only 99 copies available to the public.
As I write this, there are only 56 left…
To pick up yours…
Best Regards
Graham Summers, MBA
Chief Market Strategist
Phoenix Capital Research
