Trump vs. Harris: Which Presidential Candidate is Better for Stocks?

As the U.S. presidential election approaches, investors are wondering which candidate, Donald Trump or Kamala Harris, would be better for stock market performance. Historical data suggests that one party has consistently delivered higher average annual returns for stocks over the last century.


During Donald Trump's presidency, the Dow Jones Industrial Average (^DJI), S&P 500 (^GSPC), and Nasdaq Composite (^IXIC) gained 56%, 67%, and 138%, respectively. In contrast, during President Joe Biden's term, the Dow, S&P 500, and Nasdaq Composite rallied 36%, 50%, and 36%, respectively, as of Oct. 10, 2024. However, it is essential to consider that Trump inherited a stock market that was already in a bullish trend, and Biden took office during the COVID-19 pandemic, which significantly impacted market performance.


One factor contributing to the stock market's performance under Trump was his tax cuts, which reduced the corporate tax rate from 35% to 21%. This policy change increased corporate profitability and, consequently, stock prices. Additionally, Trump's deregulatory efforts and pro-business stance may have contributed to the positive market performance during his administration.

On the other hand, Kamala Harris has proposed raising the corporate tax rate to 28% and implementing stricter regulations on businesses. These policies could potentially negatively impact corporate profitability and, consequently, stock prices. However, it is essential to note that Harris' proposals are subject to change, and her ultimate stance on economic policies may differ from her current campaign platform.

In conclusion, while historical data suggests that the Republican Party, under which Trump served, has overseen higher average annual returns for stocks over the last century, it is crucial to consider the specific policies and economic conditions that contributed to this trend. The ultimate impact of Trump's or Harris' presidency on the stock market will depend on their specific economic policies and the broader economic landscape. Investors should closely monitor the candidates' policy proposals and adapt their investment strategies accordingly.