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Earlier this month, former President Donald Trump defeated Vice President Kamala Harris to become the president-elect. As I have discussed in previous commentaries, the data suggests that U.S. presidents have little impact on the overarching market for two reasons:
1. The U.S. Economy is Massive: Though presidents wield the most power in the U.S., the economy is akin to a giant tanker – its immense size and complex interconnectedness make it challenging to switch directions on a dime.
2. Split Government: Over the past few decades, the governmental branches have been split more often than not. The inherent checks and balances thought up by the founding fathers can make it difficult to get an agenda through quickly.
Presidential Impact on Equities: Why This Time is Different
While the above points are accurate more often than not, President Trump’s second term is likely to be impactful. Because Republicans swept all three branches of government, Trump and his allies will be able to pass their agenda easier than the norm. Though the macroeconomic impact may take a few years to be realized, the Trump win will significantly impact on individual stocks. Below are five stocks that benefit the most from the Trump victory:
Oklo develops advanced nuclear reactors that provide the clean and efficient power necessary to power AI data centers. The company enjoys a leg up versus the competition because OpenAI CEO Sam Altman serves as the chairman. As if that wasn’t enough, Oklo will now enjoy political power and influence after the Trump transition team tapped Oklo board member Chris Wright to head the Department of Energy (DOE). Though the U.S. is behind in the nuclear race, the appointment clearly signals that the Trump administration will push nuclear ambitions to fuel the artificial intelligence boom.
Coinbase, the leading U.S. crypto exchange, has been one of the best performing stocks over the past year. However, the stock performance is even more impressive when investors consider the fact that the current political regime has been a thorn in the company’s side. For example, the Securities and Exchange Commission (SEC) sued Coinbase after alleging that it is operating an “unregistered” exchange.
However, Coinbase received some welcome news when then-candidate Trump announced to a cheering crowd at a Bitcoin conference that he intends to fire SEC Chair Gary Gensler on day one of his presidency. Meanwhile, Coinbase CEO Brian Armstrong is already making inroads with the new administration and is expected to meet with Trump and his team to advise them on crypto policy.
Few people have grown closer to President-elect Donald Trump than Tesla CEO Elon Musk. Musk has essentially bet the company’s future on autonomous driving and robotaxis. Earlier this week,the Trump team promised to cut back regulations on autonomous driving. The news is huge for Tesla because strict regulations have prevented Tesla from rolling out its delayed (and highly anticipated) robotaxis. Further, Sean Duffy, who Trump named for his pick for Secretary of Transportation, is another bullish signal for the stock. In 2018 remarks, Duffy said that AV “technology can be remarkable in keeping our families and kids safe.”
GEO spiked 42% on the day after the election –for good reason. The company operates private prisons, mental health facilities, and immigration detention centers. Of course, one of Trump’s primary campaign promises is to clean up the U.S. immigration system and deport illegal entrants into the country. With the pick of Tom Homan for “Border Czar,” Trump is following through on his promise. Homan, the former Acting Director of Immigration and Customs Enforcement (ICE), is an immigration hawk.
Another core promise of the Trump administration is to “unleash American energy” and “drill, baby drill.” Trump plans to deregulate environmental regulations to help U.S. energy producers unlock the country’s natural resources.
Conclusion
The resounding Trump election victory and the Republican “mandate” will dramatically impact stocks like GEO Group, Coinbase, and Tesla.
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Trump Election Victory: 5 Stocks Benefit Most
Presidential Impact on Stocks
Earlier this month, former President Donald Trump defeated Vice President Kamala Harris to become the president-elect. As I have discussed in previous commentaries, the data suggests that U.S. presidents have little impact on the overarching market for two reasons:
1. The U.S. Economy is Massive: Though presidents wield the most power in the U.S., the economy is akin to a giant tanker – its immense size and complex interconnectedness make it challenging to switch directions on a dime.
2. Split Government: Over the past few decades, the governmental branches have been split more often than not. The inherent checks and balances thought up by the founding fathers can make it difficult to get an agenda through quickly.
Presidential Impact on Equities: Why This Time is Different
While the above points are accurate more often than not, President Trump’s second term is likely to be impactful. Because Republicans swept all three branches of government, Trump and his allies will be able to pass their agenda easier than the norm. Though the macroeconomic impact may take a few years to be realized, the Trump win will significantly impact on individual stocks. Below are five stocks that benefit the most from the Trump victory:
1. Oklo ((OKLO - Free Report) )
Oklo develops advanced nuclear reactors that provide the clean and efficient power necessary to power AI data centers. The company enjoys a leg up versus the competition because OpenAI CEO Sam Altman serves as the chairman. As if that wasn’t enough, Oklo will now enjoy political power and influence after the Trump transition team tapped Oklo board member Chris Wright to head the Department of Energy (DOE). Though the U.S. is behind in the nuclear race, the appointment clearly signals that the Trump administration will push nuclear ambitions to fuel the artificial intelligence boom.
2. Coinbase Global ((COIN - Free Report) )
Coinbase, the leading U.S. crypto exchange, has been one of the best performing stocks over the past year. However, the stock performance is even more impressive when investors consider the fact that the current political regime has been a thorn in the company’s side. For example, the Securities and Exchange Commission (SEC) sued Coinbase after alleging that it is operating an “unregistered” exchange.
However, Coinbase received some welcome news when then-candidate Trump announced to a cheering crowd at a Bitcoin conference that he intends to fire SEC Chair Gary Gensler on day one of his presidency. Meanwhile, Coinbase CEO Brian Armstrong is already making inroads with the new administration and is expected to meet with Trump and his team to advise them on crypto policy.
3. Tesla ((TSLA - Free Report) )
Few people have grown closer to President-elect Donald Trump than Tesla CEO Elon Musk. Musk has essentially bet the company’s future on autonomous driving and robotaxis. Earlier this week,the Trump team promised to cut back regulations on autonomous driving. The news is huge for Tesla because strict regulations have prevented Tesla from rolling out its delayed (and highly anticipated) robotaxis. Further, Sean Duffy, who Trump named for his pick for Secretary of Transportation, is another bullish signal for the stock. In 2018 remarks, Duffy said that AV “technology can be remarkable in keeping our families and kids safe.”
4. GEO Group ((GEO - Free Report) )
GEO spiked 42% on the day after the election –for good reason. The company operates private prisons, mental health facilities, and immigration detention centers. Of course, one of Trump’s primary campaign promises is to clean up the U.S. immigration system and deport illegal entrants into the country. With the pick of Tom Homan for “Border Czar,” Trump is following through on his promise. Homan, the former Acting Director of Immigration and Customs Enforcement (ICE), is an immigration hawk.
5. Energy Select Sector SPDR ETF ((XLE - Free Report) )
Another core promise of the Trump administration is to “unleash American energy” and “drill, baby drill.” Trump plans to deregulate environmental regulations to help U.S. energy producers unlock the country’s natural resources.
Conclusion
The resounding Trump election victory and the Republican “mandate” will dramatically impact stocks like GEO Group, Coinbase, and Tesla.