The U.S. Presidential elections are just around the corner and they are as dramatic as they can be. After the recent assassination attempt on presidential candidate Donald Trump, he declared he was fine and stronger than ever. He is all set for a rematch against President Biden in November 2024.
As the U.S. Presidential election draws near, the stock market sees some major changes. Wall Street has also speculated how a change in leadership can impact the stock market. Since President Biden came into power, the S&P 500 has increased 45%, primarily led by energy, tech, and industrial companies.
With Trump leading Biden by ~3% on average, there is a high possibility that this year’s elections can go either way. While a ton of research is available on the performance of financial markets during Republican or Democrat governments, more and more stock researchers are studying how 2025 will look for the stock market if Trump wins the elections.
In this article, we have highlighted the Top 5 stocks to invest in if Donald Trump wins the 2024 elections.
How Might Trump's Winning Affect the Stock Market?
During the Biden administration, energy, tech, and industrial stocks have risen significantly. The energy sector(XLE) has risen a whopping 102%, followed by technology(XLK) +77%, and industrials (XLI) +34%.
With less than four months left until the elections, it is safe to assume that the New York Stock Exchange and other stock exchanges could change dramatically.
Trump’s 2024 proposals focus on modernizing the military, boosting domestic manufacturing, and making the United States one of the leading energy producers in the world. Moreover, during his last tenure, Donald Trump changed several government regulations, including restrictions on big banks.
As the situation remains, several investors are flocking to the “Trump Trade.” Since Trump is a supporter of low interest rates and less regulation, small-cap stocks which flourish under Dovish economic policies, can react positively if Trump wins the 2024 elections.
However, some stock researchers also think that the traditional idea that stocks from particular industries(oil, defense, etc.) perform well under Republicans and others such as energy, tech, and industrial stocks perform well under Democrats is outdated.
This is because defense and oil stocks have outperformed by around 66% during the Biden administration. Similarly, shares of Smith & Wesson, one of the largest gun companies in the US, fell during the Trump administration.
The market tends to surprise you. But one thing is certain. If Donald Trump wins the 2024 election, it will shake the stock market to its core since he has announced that he will not reappoint Jerome Powell as Fed chair.
Top 5 Stocks to Invest in If Donald Trump Wins the 2024 Election
The presidential election is just around the corner and we have identified new stocks to buy in various sectors. Each of these stocks has high growth potential and market caps above $500 million.
Carpenter Technology Corporation(CRS)
- Market Capitalization: $5.4 billion
- Quant Rating: Strong Buy
Carpenter is a metal manufacturing company based in Pennsylvania. It produces specialty metals like titanium alloys and stainless steel, majorly for the medical, industrial, and defense industries. It has over 130 years of manufacturing expertise in developing highly-engineered products.
Moreover, it has a solid track record of delivering profitable growth in a competitive market.
Despite mixed Q3 2024 earnings, Carpenter Technology still was the top industrial gainer for the week ending May 3rd. Over the last year, the stock is up over 90% and +54% YTD. Carpenter Technology Corporation is also rated #1 among quant-rated steel stocks and #7 in the materials sector.
Western Midstream Partners(WES)
- Market Capitalization: $15.4 Billion
- Quant Rating: Strong Buy
Western Midstream is a Texas-based energy-operator company. It lands on this list as one of the best stocks to buy for good reason. Over the last year, it has been up more than 50% and is rated the #1 quant-rated Oil and Gas stock, and #4 in the Energy sector.
It primarily focuses on processing and transporting natural gas, NGLs, and crude oil. Western Midstream’s strong production activity was one of the primary reasons why its profitability increased in Q1.
Moreover, it has had 8 upward revisions in the last three months and offers a handsome dividend yield of 8.6% with a 10-year consecutive payout record.
Read Also:- 8 Best Lithium Stocks Of 2024
Argan Inc.(AGX)
- Market Capitalization: $964.8 million
- Quant Rating: Strong Buy
Argan Inc. has been up a staggering 76% since last year and is rated #3 construction and engineering stock. It has three primary business sectors- power industry services, industrial construction, and telecommunications/infrastructure services.
Argan is positioned to expand in developing power and infrastructure solutions, driven by federal grants and tax incentives. Besides business segment expansion, it had a $84 million backlog in Q1, including $300 million in renewable projects.
Its revenue rose 36% year-on-year, EPS +40%, and levered FCF over 2,730%.
Wells Fargo & Company(WFC)
- Market Capitalization: $209.7 Billion
- Quant Rating: Strong Buy
Wells Fargo is one of the biggest banks in the United States and also one of the biggest stock movers following its Q2 2024 earnings. It is the #1 quant-rated diversified bank stock and rated #5 in the financials sector.
It is up 30% in the past year and stock researchers suggest that big banks like Wells Fargo might benefit from less strict capital and liquidity rules under Trump’s second administration. Moreover, the prospect of lower borrowing costs has driven up the S&P 500 banks index by nearly 20% in 2024.
Wells Fargo has exceeded its earning target in Q2 2024 and raised its dividend by +14%, making it one of the best stocks to invest in if Trump wins the 2024 election.
L3 Harris Technologies Inc.(LHX)
- Market Capitalization: $43.6 Billion
- Quant Rating: Strong Buy
L3 Harris is a top-rated defense stock that focuses on U.S. National security. It has strong consecutive top and bottom line beats and its solid Q1 results were largely due to strong operational performance and revenue increases in Intelligence and Cyber sectors.
Its largest customers are the U.S. government and its agencies. It has over 50k employees and a $20.16 billion revenue over the last twelve months. It offers a portfolio of space, air, land, sea, and cyber technologies to militaries worldwide, making it one of the best stocks to buy in case Trump wins the 2024 presidential elections.
Read Also:- Best Cash App Stocks to Buy in 2024
Other Top Trump Trade Stocks
Digital World Acquisition Corp(DWAC)
DWAC is a SPAC linked to Trump which came into the limelight when the SEC declared the registration statement of its proposed merger with Trump Media and Technology Group, the parent company of Trump Social.
If Trump reigns supreme in the 2024 elections, Digital World Acquisition Corp and other Trump-related companies could see a massive boost.
BRC Inc. (BRCC)
BRC Inc. is a company created by U.S. Army veterans who served in Afghanistan and Iraq. It has a history of aligning with pro-Trump and pro-right-wing ideologies on different political matters.
It is one of the top stocks to have exposure during the Donald Trump tenure in the past. If Trump comes into power, companies like BRC Inc. could greatly benefit from it. Much like BRC, companies like JP Morgan Chase, Exxon Corp, and Chevron Corp could potentially also benefit from Trump’s presidency.
Fluor Corp(FLR)
According to a report by Goldman Sachs, the engineering construction company Fluor Corp could benefit from Trump’s presidency as he plans to bolster our border defenses. It is one of the companies that was involved in border construction activities during the last tenure of Donald Trump.
It is safe to assume that if Trump comes into power, Fluor Corp and other related companies could see an increase in revenue.
VALE S.A. (VALE)
Goldman Sachs believes that VALE S.A. is another top stock that could rise if Trump wins the elections. VALE along with some other steel stocks can benefit as steel manufacturing is proposed to increase in the Republican government.
In Q4 of 2023, VALE produced 89.4 million metric tons of iron ore, surpassing the past estimate of 83 million metric tons.
Peabody Energy Corp(BTU)
Peabody Energy Corp is a coal mining company that could rise in Trump’s administration if the Republicans continue to promote traditional fossil fuel energy practices instead of President Biden’s green energy initiatives.
Goldman Sachs also thinks that Peabody Energy Corp is one of the best stocks to invest in if the Republican party comes into power in the 2024 elections.
Final Words
Events like elections and administration changes can have a huge impact on the stock market. After the recent assassination attempt on presidential candidate Donald Trump, Wall Street stock researchers have started to speculate how a government change could impact the stock market.
While stocks have risen around +45% during Biden’s administration, professional investors think the market will turn volatile as the wave of “Trump Trade” hits. Former President Donald Trump supports more oil drilling, military spending, protectionism, and deregulation. It is safe to assume that stocks in these sectors could skyrocket if the Republican party wins the 2024 election.
