Without a doubt, the US election is going to have a massive impact on many American companies, as well as those based abroad. Presidential candidates Harris and Trump have different economic priorities, reflecting the different approaches of the political parties they belong to.
Either candidate, if elected this November, will have plans for all kinds of projects that will require the support of companies and organisations in different sectors. For those companies, revenue and profits - and therefore stocks - could see some potentially significant growth. So who do you think will win the US election? And which stocks are you going to grab before this November?
Which stocks might do well under Harris? 🟦🟦🟦
If Kamala Harris, the current Vice President, is elected she seems likely to continue along a similar path to her predecessor Joe Biden, in terms of her economic policies as a Democratic leader. This would mean the US government pumping cash into sectors like green energy, as well as continuing its support of domestic manufacturing.
One area in which Harris is different from Biden is her stance on Big Tech - and Big Tech’s stance on her. Harris is from Oakland, California, close to Silicon Valley, and has the seal of approval from some major figures in tech, such as Salesforce CEO Marc Benioff who supported her 2020 presidential bid. Biden was less popular in the tech world, introducing legislation last year that aimed to block Big Tech mergers.
Harris would likely continue Biden’s support for domestic chip production in the US, which could lead to American chip making companies making huge profits. But will this be enough to sway Republican support in the tech world? Tesla CEO Elon Musk has been making donations to the Trump campaign…
Green energy stocks
- First Solar, Inc: One of the major players in the solar energy space in the US, 80% of First Solar’s net income last year came from domestic manufacturing tax credits from the Biden Administration’s Inflation Reduction Act (IRA).
- Enphase Energy Inc, Solaredge Technologies Inc and Sunrun Inc: These companies also received government funding under the Biden administration. Enphase Energy makes EV batteries as well as solar technology - electric vehicles are another sector that have been championed by Biden during his presidency.
US manufacturing
- Micron: In April this year, it was announced US$6.14 billion from Biden’s CHIPS and Science Act would support chipmaker Micron to build two new fabs in New York and Idaho for production of microchips in the US.
- Eaton Corporation plc: Eaton has been highlighted by analysts as one manufacturing stock that could benefit from the Democrats focus on electrification - Eaton works in aerospace, vehicles and e-mobility.
EV charging network operators
- ChargePoint Holdings, Beam Global, Blink Charging: As part of the Democratic push towards green policies, companies that operate electric vehicle charging networks could also see a boost. During Biden’s presidency, he shared a goal that 50% of all new vehicle sales should be electric by 2030, meaning that there would be a high need for charging networks across the US.
Which stocks might boom under Trump? 🟥🟥🟥
Donald Trump has said if elected again, he would be the first ‘crypto president’. At the end of July, he spoke at the Bitcoin 2024 conference in Nashville, and announced that he planned to make the US the world leader in cryptocurrency. Since then, Bitcoin has reached its highest price in 6 weeks - so companies that operate in the crypto space could also do very well as a result, if Trump is elected.
This is one of the reasons for some of Big Tech’s most well known figures’ support for the Republican party - they believe his presidency would be good for crypto, good for tech and good for big business. Trump’s running mate JD Vance holds a significant amount of Bitcoin himself, sharing in 2022 that he owned between $100,000 and $250,000 of the cryptocurrency.
Trump has also pledged to lower energy costs through increasing the use of oil and natural gas. At the Republican National Convention he declared ‘We will drill, baby, drill!’, in a loud and clear signal that his administration would be going in hard on fossil fuels.
Crypto stocks
- Coinbase Global Inc: As we covered in our daily Hot Stocks column, Coinbase stands to benefit from a rise in value in Bitcoin - about a third of all the cryptocurrency transactions that take place on this trading platform involve Bitcoin.
- MicroStrategy Inc: MicroStrategy’s shares received a boost after Trump’s appearance at the Bitcoin Conference. The tech company started buying Bitcoin in 2020 and is now the largest corporate holder of the crypto, holding more than 1% of all the Bitcoin that can ever exist.
Oil and natural gas
- Exxon Mobil Corp: After Trump’s speech at the Republican National Convention where he pledged to support the fossil fuels industry, Exxon’s stock rose by 0.2%. Exxon is the world’s largest investor-owned oil company.
Banks
- JPMorgan, Goldman Sachs, Bank of America: US banks are likely to make higher profits under a Republican administration - the typically Republication policy of deregulation allows businesses to operate more freely, without as much influence from the government. JPMorgan stock saw its biggest increase in value in 20 years during Trump’s presidency in 2019, going up by 42.80%.
Stocks that could drop under each candidate
Of course, these stock predictions go both ways. For example, under Donald Trump, the green energy companies that would do well under Kamala Harris would likely suffer compared to their performance under a Democratic administration.
Likewise, oil and gas company shares would likely drop in value if the Democrats win in November - especially due to Kamala Harris’ personal tough stance on oil. Harris prosecuted and investigated many of these companies on green issues during her time as California attorney general, including Exxon.
Looking for a safer bet? ⚖️
If you are thinking about getting into investing in stocks and shares but would rather not bet on how the US election turns out in November, there are some stocks that may be less likely to change in value based on which party wins.
‘Blue chip’ stocks are stocks which have a long history of stability. While investing in stocks and shares will always involve an element of risk, analysts often say these stocks are a lower risk investment. Companies that provide blue chip stocks usually have a huge market capitalization, and show consistently strong financial performance.
Here are two options for popular blue chip stocks you can check out if you’re feeling like playing it a little more safe. Remember, diversifying your portfolio with a wider range of stocks should help protect your investments from market volatility, more so than investing in any one particular stock.
- Johnson & Johnson: This holding company is a giant in the healthcare industry, making medical devices, personal healthcare products and also pharmaceuticals. It’s a huge company that is perhaps most well known for its over-the-counter consumer brands, owning Tylenol, Benadryl, Band-Aids and many others.
- American Express: The credit card company and payments network is 170 years old and an American household name. It increased its dividend payouts by 17% this March.
