Finance
67% of investors say Trump is better for stocks than Biden, but market predictions are all over the place
In a landscape where economic policy and market performance often intersect, a CNBC survey found that investors favor former President Donald Trump’s potential impact on the stock market.
The poll, which surveyed 400 investors, traders and money managers, found that 67% believe Trump would bring more benefits to stocks.
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CNBC said the sentiment appears to be rooted in historical performance. During Trump’s four-year term in office, the S&P 500 rose 68%, while the Nasdaq rose 137%. In contrast, under the Biden administration so far, the same indexes are up 44% and 34% respectively.
However, the investing community is divided on the short-term trajectory of the market. The research showed that there was an even distribution among respondents; a third expect a decline, another third expect gains, while the remaining third see a market with limited margins.
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That uncertainty reflects the factors influencing the current economic landscape. While presidential policy can influence market sentimentother elements often play a more important role. As Kristina Hooper, chief global markets strategist at Invesco, told the New York Times: “Markets are politically agnostic. With good reason: it doesn’t matter.”
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The recent market rally can largely be attributed to investor enthusiasm around artificial intelligence (AI) instead of political developments. CNBC noted that Microsoft emerged as the frontrunner in the AI race, with 50% of respondents considering the company best positioned to benefit from the technology. Surprisingly, Nvidia wasn’t at the top of that list.
The Federal Reserve’s monetary policy decisions remain a factor. Two-thirds of respondents expect the Fed to cut rates before the end of the year (with many seeing a rate cut as early as September), a move that could impact the market.
Interestingly, despite the clear preference for Trump in terms of market performance, investors showed concerns about the current state of the major indices. Eighty percent of respondents admitted to feeling uncomfortable about the heavy concentration of technology stocks in the benchmarks.
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Looking beyond equities, the survey highlights India as the most attractive overseas market, followed by Japan and Europe. In the absence of equities, corporate bonds emerged as the preferred investment instrument.
As the 2024 election approaches, investors are reminded that while presidential rhetoric often links market performance to government policy, the reality is much more nuanced. Historical data shows that markets generally trend upward regardless of which party occupies the White House.
While investor sentiment may be tilting toward Trump due to potential market gains, the road ahead for stocks ultimately appears as unpredictable as ever, as the survey results show.
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This article 67% of investors say Trump is better for stocks than Biden, but market predictions are all over the place originally appeared on Benzinga.com
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