Throughout his presidency, Donald Trump was known to use fear as a motivator. During his election campaign in an attempt to scare voters, Trump declared that the stock market would crash under Biden. That hasn’t happened yet. So far, investors seem to love Biden.
In the weeks leading to the Nov. 3, 2020 U.S. presidential election, incumbent Trump wrongly predicted numerous times that if Biden won, the stock market would falter, according to Factbase, a database that collects and analyzes the truth in Trump’s statements.
During the second presidential debate on Oct. 22, Trump said that if he was reelected, the stock market would “boom,” and “if (Biden) was elected, the stock market will crash.” He made the claim again during a campaign rally in Pennsylvania on Oct. 31, saying, “If (Biden) gets in, the market will crash,” Snopes reported.
In fact, on Nov. 24 as Biden’s transition to the White House formally got underway, the stock market hit a record high. Trump acknowledged the stock market record with a brief announcement in the White House briefing room.
The Dow passed the 30,000 milestone for the first time as stocks posted solid gains Tuesday, extending Monday’s rally.
The Dow wound up the day Tuesday with almost a 455-point increase, or 1.5 percent. The blue-chip index hit a new all-time high, finally topping the 30,000 mark. The Dow is now up more than 5 percent in 2020, CNN reported.
The S&P 500 closed 1.6 percent higher and the Nasdaq finished 1.3 percent higher on Tuesday.
The latest catalyst for the boom, the formal transition from Trump to President-elect Biden has finally gotten underway.
Promising coronavirus vaccine developments also helped the stock market see an uptick.
Oil prices rallied as well, lifting big energy stocks like Occidental Petroleum and Marathon Oil, CNN reported.
“The fact that we have more certainty on what hopefully is an orderly transition is putting some wind in the sails for crude,” Stewart Glickman, energy equity analyst at CFRA Research told Bloomberg. “The biggest issue ahead is how willing they’ll (Congressional representatives) be to cross the aisle and enable a stimulus package to happen. That’s going to be a primary driver.”
Even the travel sector seems to be on the rebound. Travel-related companies including airlines, cruise lines and hotels saw shares rise.
Stock markets rallied not just in the U.S. but globally. World shares rallied to a record peak on Nov. 25 following an overnight surge. Investors cheered a dramatically improved global outlook, Nasdaq reported.
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“The main thing now is that it has become official that the Biden administration will start. And we have ample liquidity from the world’s central banks,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
“I expect the honeymoon between financial markets and the Biden administration and stocks’ bull trend could continue until around his inauguration in January,” the Morgan Stanley strategist said.
