To The Moon

[Allin]Hello Tigers,

The US election results are imminent, and the Republicans are already ahead of the Democrats.

Do you know which sectors of the US stock market will rise better under different ruling parties?

By observing the performance of ETFs in different industries under different ruling parties, we can find some interesting trends.

According to the above chart, below are highlights of the impact of the ruling party's policies on the stock market

Obama Era (2009-2017): During Obama’s first term, the $Industrial Select Sector SPDR Fund(XLI)$ top the returns. And the $Fidelity Clean Energy ETF(FRNW)$ industry performed poorly, with a cumulative decline of 54%. However, during Obama's second term, the industry rebounded, growing 22%. This may reflect the government's emphasis on and policy support for renewable energy. Meanwhile, Traditional Energy $Energy Select Sector SPDR Fund(XLE)$ performed well during Obama's first term, growing 84%, but growth slowed to 8% in his second term. This may indicate that the market is cautious about the long-term prospects of traditional energy.

Trump Era (2017-2021): Under Trump, the traditional energy industry $Energy Select Sector SPDR Fund(XLE)$ experienced a significant recovery, with cumulative growth of 306%, which may be related to the Trump administration’s support for the fossil fuel industry Policy related. Meanwhile, the Technology sector $Technology Select Sector SPDR Fund(XLK)$ also performed well, growing by 179%, which may reflect the market's continued demand for innovation and technology.

Biden Era (2021-2024): Under Biden, the traditional energy industry $Energy Select Sector SPDR Fund(XLE)$ once again performed strongly, growing 139%, which may be related to the global economic recovery and increased energy demand. and technology stocks $Technology Select Sector SPDR Fund(XLK)$ followed.

To summarize:

• From the above data, we can see that the policies of the ruling party have a significant impact on the stock market.

• Under Obama, the clean energy industry received policy support, while under Trump, the traditional energy industry benefited from government support.

• The traditional energy sector continues to perform strongly during the Biden era, despite challenges facing the clean energy industry.

• Additionally, the technology industry has maintained strong growth across all ruling periods, demonstrating long-term demand in the market.

The following, we would like to share a chart for you to ”trade Trump”.

1. Trump Concept Stocks

These stocks are directly tied to Trump's business or political activities:

• $Trump Media & Technology(DJT)$ : Owns "Truth Social," a platform gaining traction with Trump's electoral prospects.

• $Phunware, Inc.(PHUN)$ : Developed the "Trump 2020" app, closely linked to his campaigns.

• $Rumble Inc.(RUM)$ : A video platform popular with conservatives, partnered with DJT for services.

2. Trump’s “policy preference” concept stocks

Trump's policy philosophy revolves around "America First" and emphasizes the United States' economic independence, traditional values ​​and strong national defense. The proposing and implementation of this concept had a profound impact on many industries of the American economy.

• Impact of tax reduction policies

The "Tax Cuts and Jobs Act" after Trump took office is the core of his economic policy, aiming to stimulate investment and consumption by lowering corporate tax rates. Trump plans to lower the corporate tax rate from 21% to 15%, which will directly increase corporate profit margins and promote the return of investment.

Financial large banks such as $JPMorgan Chase(JPM)$ , $Goldman Sachs(GS)$ , and $Bank of America(BAC)$ , could gain from proposed corporate tax cuts. In addition, tax cuts will stimulate corporate investment in R&D and expansion, further boosting economic growth.

• Energy independence and the resurgence of traditional energy

Trump advocates restoring the supply of traditional energy and emphasizes the independence of American energy. He plans to simplify the licensing process for energy extraction and end restrictions on oil, gas and coal.

Driven by this policy, large energy companies such as $Exxon Mobil(XOM)$ and $ConocoPhillips(COP)$ will gain greater market space. This would not only increase U.S. competitiveness in global energy markets but also help lower energy prices, thus having a positive impact on the entire economy.

• Return and support of manufacturing industry

The Trump administration is committed to bringing manufacturing back to the United States and emphasizing the importance of "Made in America." By protecting and supporting critical supply chains, Trump hopes to create more local jobs and increase wages for American workers.

Related stocks such as $Caterpillar(CAT)$ will benefit from this. Caterpillar's leadership in heavy machinery and equipment gives it more opportunities in the manufacturing reshoring policy.

• Strengthening of national defense and security

Trump’s defense policy emphasizes strengthening the United States’ military capabilities to respond to global security challenges. Defense spending figures prominently in Trump's policies, which will create lucrative market opportunities for defense contractors.

Defense companies such as $RTX Corp(RTX)$ , $Lockheed Martin(LMT)$ and $Northrop Grumman(NOC)$ are expected to benefit from increased defense spending. These companies not only have competitive advantages in military equipment and technology research and development, but will also see growth in government contracts.

• Public support for concept stocks in the technology sector

In the tech sector, Harris is a champion of technological innovation, and companies active in artificial intelligence, cybersecurity and digital infrastructure could be winners if Harris is selected. However, $Tesla Motors(TSLA)$ and $Palantir Technologies Inc.(PLTR)$ have funded the Trump campaign. After Trump was assassinated in July this year, Musk officially supported the former president, shared his support for Trump many times on X, and even established the America PAC.

• Trade protection

The biggest risk Trump's election poses to markets is the trade war. Trump hopes to narrow the current account deficit through more aggressive tariffs and a weak $USD Index(USDindex.FOREX)$ policy, and imposes high tariffs on imported goods. He recently said that Taiwan has taken away the U.S. semiconductor business and should pay the United States, which caused fluctuations in $Taiwan Semiconductor Manufacturing(TSM)$ stock price. In addition, he also proposed to revitalize "key defense industries" and the "U.S. automobile industry" and promote the development of related industries by investing in the construction of the "Iron Dome Missile Defense Shield."

Semiconductor companies such as $Intel(INTC)$ and $Qualcomm(QCOM)$ and $Texas Instruments(TXN)$, as domestic companies in the United States, will benefit from trade protection. And $General Motors(GM)$ and $Ford(F)$ also benefit as American cars.

• Cryptocurrency

Republican candidate Trump has made clear his support for cryptocurrencies. In May of this year, the Trump campaign announced that it would accept donations of digital currencies such as Bitcoin and Ethereum, and Trump himself has become increasingly positive about cryptocurrencies.

In early June, Trump met with the leaders of several $Bitcoin(BTC.USD.CC)$ mining companies at Mar-a-Lago. Not only did he express his support for cryptocurrency, he also promised that if he was re-elected as president, he would become an advocate for the cryptocurrency mining industry and Make sure any remaining Bitcoins are "Made in the USA."

$Marathon Digital Holdings Inc(MARA)$ $CleanSpark, Inc.(CLSK)$ $Riot Platforms(RIOT)$ are cryptocurrency miners engaged in cryptocurrency mining business, while $Coinbase Global, Inc.(COIN)$ is well-known A digital currency trading platform that benefits from the growth of the digital currency market and provides convenient digital currency trading services. $MicroStrategy(MSTR)$ , a company originally engaged in business intelligence and enterprise-level software platforms, is one of the few companies that has decided to reinvest some or all of its cash reserves in Bitcoin.

There is currently less than a month until the U.S. general election is held. Although Trump currently has the advantage, everything has not yet been settled. In particular, stocks that are strongly related to Trump may experience large fluctuations.

Tigers can pay attention to their corresponding risks according to their own circumstances.

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