With the US election entering its final lap, the contest between Trump and Harris remains extremely close. The nation is preparing to vote on 5 November and a potential Trump victory could lead to significant market shifts, particularly in sectors aligned with his policies.
His “America First” agenda is likely to bolster traditional industries such as construction, infrastructure, and energy.
Here are the stocks that could stand to gain if Trump is elected as the next US president.
Trump is expected to strengthen US defence capabilities, potentially benefiting companies in this space. The VanEck Defense ETF (DFEN.MU), which holds a majority of its assets in US defence contractors, could see increased interest.
“Its portfolio includes American government and military contractor Booz Allen Hamilton (BAH) which is an intelligence specialist; Palantir Technologies (PLTR) which helps the US army with data insights; and Leidos (LDOS) which supports homeland security and is active in weapons systems research and development,” Dan Coatsworth, investment analyst at AJ Bell, said.
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Stocks such as Lockheed Martin (LMT) and Northrop Grumman (NOC) could benefit from increased defence spending.
A Trump 2.0 administration could favour domestic fossil fuel producers as he aims to enhance America’s energy security.
“A Trump election victory could also create a tailwind for domestic fossil fuel producers in an effort to fortify America’s energy security. Approximately two thirds of exchange-traded fund iShares Oil & Gas Exploration & Production (IOGP.AS) is held in US-listed assets, including a stake in EOG Resources (EOG) which is one of America’s key oil and gas players, Coatsworth said.
Trump is also likely to prioritise increased domestic oil and gas production, positively impacting stocks like Exxon Mobil (XOM) and Chevron (CVX).
“A Trump win could bring Exxon Mobil regulatory relief, including relaxed environmental restrictions and lower corporate taxes, both of which could enhance profitability and support increased domestic production, Kathleen Brooks, founder of Minerva Analysis, said.
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“Exxon’s financial strength is a key differentiator. With a strong balance sheet and substantial free cash flow, it has the firepower to maintain its dividend payments and continue its stock buyback programs. Though nothing is guaranteed,” she added.
Companies such as Geo Group (GEO) and CoreCivic (CXW) may benefit from increased demand for detention facilities amid a crackdown on immigration.
GEO and CoreCivic oversee only about 9% of the US prison population, allowing for potential growth. Shares in GEO Group rose by 24%, and CoreCivic by 15%, in the last month.
Also, stocks of firearm manufacturers like Vista Outdoor Inc. (VSTO) and Smith & Wesson Brand Inc. (SWBI) could be blazing if voters opt for Trump to run the White House.
Trump’s ambition to make America the “crypto capital of the planet” could lead to significant movements in the cryptocurrency market.
“In theory, cryptos could see the biggest and most immediate price action if Trump wins. However, it’s interesting that the bitcoin price has been volatile in recent weeks, suggesting that some investors and traders might be waiting for a stronger signal that Trump will win before going all-in on the digital currency,” Coatsworth said.
TD Cowen analysts have also highlighted the likelihood of the former president naming a pro-crypto SEC chair.
A Trump victory could lead to a continuation of the deregulatory trend established during his previous administration. This might benefit large financial institutions such as JPMorgan Chase (JPM), Bank of America (BAC), and Citigroup (C), as reduced regulations could enhance profitability and spur lending activity.
For the auto sector, producers with strong exposure to the domestic market (Ford (F), General Motors (GM) are preferable. In the EV segment, Tesla (TSLA) could rise on the back of strong support from Elon Musk for Trump’s election campaign.
Not a market sector but companies like Trump Media & Technology Group (DJT) and Phunware (PHUN) could see gains if Trump is re-elected.
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For the second quarter, Trump Media reported a loss of $16.4m and revenue of $837,000. The company has a market capitalization of around $6bn.
“The stock is going to crash and burn if Harris pulls out a victory,” Brian Lukow, a former Lehman Brothers senior vice president-turned-movie producer who now shorts stocks, told Reuters. “If Trump wins, then this bet looks like the greatest bet he’s ever made.”
With only one day before election day, Trump and Harris are focusing on swing states as they aim to sway undecided voters.
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