The message from Wall Street is clear: buckle up, because the 2024 election is shaping up to be a wild ride. With the S&P 500 rallying by an impressive 20% year-to-date, it’s the best Election Year performance through October since 1936. But that streak could hit some turbulence as the race tightens and market players brace for what’s expected to be a nail-biter of a presidential election. The question on everyone’s mind: what would a Trump vs. Harris presidency mean for business and investors?
With predictions markets currently showing a 59.5% chance of a Trump victory, a wave of “Trump trades” is already surging back. This anticipation alone has seen Treasuries dip and gold prices soar, as investors hedge their bets on Trump’s familiar policies—tariffs, tax cuts, and deregulation—which some fear could spur inflation. “The key for markets will be certainty in the outcome from which to understand economic impacts and evaluate implications for the trend of economic growth and evaluation of sector winners and losers,” noted Rob Haworth, senior investment strategist at US Bank Wealth Management. Let’s break down what each side could mean for Wall Street.
Trump Trades: Financials, Gold, Managed-Care Insurers
Under a Trump presidency, financial stocks are expected to soar as Trump’s push for deregulation would reduce barriers for mergers and acquisitions. Biden’s 2021 executive order tightened scrutiny on M&A, stifling deal activity, but a Trump administration could open the floodgates. According to Christopher Wolfe from Fitch Ratings, “Approval times have increased markedly,” which has made many deals “non-viable.” By contrast, a Red sweep would likely bring a looser regulatory environment, reduced costs, and potentially huge capital returns for financials. Kurt Reiman of UBS calls this “a key beneficiary” scenario, where financial giants could operate more freely.
Gold is another major player in the Trump portfolio. With Washington’s spending spree running unchecked, gold prices have rocketed, closing last week at $2,734.44 an ounce, a staggering 34% increase this year. Wealth Alliance President Eric Diton points to the $35 trillion debt looming over the nation, “We just don’t have a plan to deal with it… I haven’t heard any talk about any kind of reduction in spending from either candidate.” Yet with Trump, markets see the writing on the wall: if inflation spikes, so does gold.
Managed-care insurers, too, have much to gain. Republicans have long backed privatized health care models like Medicare Advantage, which could be a windfall for companies like Humana, UnitedHealth, and CVS. As Michael Wiederhorn from Oppenheimer notes, a Trump administration would likely “support strong rate increases and a favorable regulatory environment” for Medicare Advantage providers.
Harris Trades: EVs, Homebuilders, Discount Retailers
On the other hand, Kamala Harris’s agenda favors electric vehicles (EVs), homebuilders, and discount retailers. A Harris administration is expected to stick with Biden’s aggressive EV goals, including the $7,500 tax credit for new EVs. Analysts see this as a win for auto giants like GM, Ford, and Tesla, with Wedbush’s Dan Ives calling it “a positive for the EV industry broadly.” As for homebuilders, Harris has pledged to make housing affordability a priority, aiming to build three million new units. D.R. Horton, one of the industry’s biggest players, stands to benefit from Harris’s plans, which could boost entry-level housing demand.
In the retail sector, Harris’s focus on social programs would likely fuel growth in off-price retailers like Burlington and Ross. Evercore’s Michael Binetti explains that “a blue sweep would likely benefit the lowest-income consumers,” positioning Burlington Stores as a top performer. With inflation tightening household budgets, discount retailers have enjoyed strong growth, and a Harris administration could extend that trend.
Conclusion
With Election Day here, Wall Street is bracing for market jitters, and each candidate offers a drastically different path forward. A Trump administration signals a return to deregulation, tax cuts, and financial freedom, while Harris would double down on government intervention, pushing social programs and green energy. Wall Street may be jittery, but one thing’s for sure: a Trump presidency spells opportunity for financial markets, gold investors, and insurers looking for relief from bureaucratic red tape.
Americans have a clear choice here: they can vote for the party that believes in unleashing economic growth, or they can stick with a government-heavy approach that leaves more red tape than real progress. Trump’s policies offer a path to prosperity that empowers individuals, businesses, and investors alike. As the markets are already predicting, when it comes to financial freedom and economic opportunity, it’s clear which candidate has the right answers.
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