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Market Surge Expected to Continue Under Trump Presidency, Says Finance Professor Jeremy Siegel

everything points upward wharton professor jeremy siegel says the economy and stock market will be stronger than expected in 2021 4161022192 scaled

the staff of the Ridgewood blog

Ridgewood NJ, as President-elect Donald Trump prepares to take office, the stock market may be in for an unprecedented boost, says Jeremy Siegel, finance professor at the Wharton School of the University of Pennsylvania. Trump’s pro-business agenda, Siegel believes, could make him the most stock market-friendly president in history.

“President-elect Trump is the most pro-stock market president we have had in our history,” Siegel shared Monday on CNBC’s Squawk Box. “He measured his success in his first term by how well the stock market did. It seems very unlikely he’s going to implement policies that are bad for the stock market.”

Following Trump’s election win, investors responded with enthusiasm, driving markets to record-breaking levels as they anticipated growth-focused policies such as tax cuts and deregulation. Last week, the S&P 500 hit a new all-time high, climbing 4.66%—the best performance since November 2023—and surpassed 6,000 points. The Dow Jones Industrial Average also reached new heights, breaking the 44,000 mark.

Key sectors surged in response. Tesla, backed by prominent Trump supporter Elon Musk, saw a dramatic 29% increase in its stock price, returning the company to a $1 trillion market cap. Major bank stocks like JPMorgan Chase and Wells Fargo also experienced significant gains, while Bitcoin continued its upward trajectory, with many investors anticipating lighter regulatory pressure under Trump.

Siegel expects Trump to focus on extending the corporate tax cuts he initiated in 2017, which could serve as a pillar of his second-term economic strategy. “The extension of his 2017 tax cuts looks pretty much like a slam dunk,” Siegel noted, though he acknowledged that further tax cuts might be more challenging to pass.

However, Siegel cautioned that Trump’s trade policies, including potential tariffs on trading partners, could stoke inflationary pressures and present challenges for the Federal Reserve. The Fed has been working to combat inflation through interest rate hikes, and aggressive trade policies could complicate these efforts.

As the market eagerly watches Trump’s next steps, investors appear poised for a potentially robust run, buoyed by the hope of a market-friendly administration focused on growth and deregulation.

 

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