SALT LAKE CITY (ABC4) – Many people are curious about what happened to the stock market on President Joe Biden’s Inauguration Day. Did it go up or down, how did it compare to other presidents?
The stock market soared to a four decade-high on the new administration’s first day, and a little luck and hope may be involved.
The truth is, the markets move on many factors, and a president can’t take credit for what happens with the market.
Sam Watkins, a Certified Financial Planner and Chief Information Officer for TruNorth Wealth in Utah says, “Who controls the White House or Congress has a lot less impact on the market than you think. It’s easy and tempting to say one thing that caused the markets to move, but the truth is the markets move on hundreds of factors, and what you saw yesterday is actually happening for the last two or three months as the Biden administration was counted in.”
Pretty good means, the Dow, the S&P 500, and the Nasdaq all hit new records. The NASDAQ’s composite rise of 2% is the best rally on record.
The Dow Jones Industrial Average (DJIA) rose 0.8%, and the S&P rose 1.5% for the best inauguration upswing since Ronald Reagan started his second term.
The country seemed to take a deep breath, and Wall Street joined in. But to be fair, the stock market has been surging, despite how hard the economy has been twisting.
Watkins cautions, “If you look back at the markets, historically the parties and presidents affect them a lot less than the headlines, and are affected a lot less than the public narrative.”
President Trump always mentioned how well the economy was doing and took credit for many stock market swings. Still, the truth is the DOW had its biggest increases under Bill Clinton, Ronald Reagan, and Barack Obama.
Trump’s administration did really well, but to be fair to them, you have to ask – what would have happened if there had not been a pandemic?
Watkins says, “If you had told us last March markets were going to end so high on the year, we would have been floored back in March. The financial programs have helped keep everything going, and the promise of vaccines has moved it up. We have borrowed a little from the future, but sometimes that is good, like when you purchase a new car.”
Positive news when a new president comes in is always good, but Watkins says,” There’s always going to headline based movements, but they are generally noise. You should focus on the long-term planning of your investments, which has nothing to do with who’s president.”