According to Jeremy Siegel, professor of finance at the Wharton School of the University of Pennsylvania, the stock market could get a bigger boost from newly elected President Donald Trump than any previous administration thanks to his pro-business policies.
“President-elect Trump is the most pro-stock market president we’ve had in our history,” Siegel said Monday on CNBC’s “Squawk Box.” “He measured his success in his first term by how well the stock market did. You know, it seems very unlikely to me that he’s going to implement policies that are going to be bad for the stock market.”
The market has already reached new heights in response to Trump’s election victory, as investors bet that his promises of tax cuts and deregulation will boost growth and benefit risky assets.
The S&P 500 rose 4.66% last week for its best week since November 2023, trading above 6,000 for the first time ever. The blue-chip Dow Jones Industrial Average also climbed above a new mark of 44,000 after the election.
S&P500
Investments that were considered the biggest beneficiaries under the Trump presidency exploded during the week.
Tesla, whose CEO Elon Musk is a prominent Trump backer, saw its shares skyrocket 29% to return to a $1 trillion market cap. Bank stocks like JPMorgan Chase and Wells Fargo also saw big rallies. Bitcoin continued to reach record highs as traders see relaxed regulations under Trump.
Siegel believes Trump’s corporate tax cuts are likely to be extended from his first term in 2017.
“I think the expansion of his 2017 tax cuts looks a lot like a slam dunk, but the expansion to all of his other tax cuts is certainly going to be much more difficult,” Siegel said.
Still, the newly elected president’s trade policies, including his pledge to impose high tariffs on trading partners, could hurt growth and fuel inflationary pressures at a time when the Federal Reserve has been raising rates for more than two years to stem price increases to push.