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Inauguration Looms: 5 Industries Trump will Mention

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The Political Winds Have Shifted: Trump 2.0

On Monday, January 20th US equity markets will be closed to observe Martin Luther King Jr. Day. Though federal holidays are usually reserved days for Wall Street traders to relax and unwind, this time is different because January 20th also marks President-elect Donald Trump’s inauguration as the 47th president of the United States.

Though both major US political parties politicize the stock market (along with everything else), history proves that the general market’s direction has less to do with a president’s policies and more to do with liquidity from the Federal Reserve Bank. In fact, the data shows investors that US stocks rise in the long run, regardless of who is in power. That said, US presidents can significantly impact specific industry groups. This time, the impact of a new president may be even more pronounced. President-elect Donald Trump and outgoing President Joe Biden couldn’t be further apart on most issues. Furthermore, the political pendulum has swung in the completely opposite direction with Republicans taking control over all three branches of government. Below are five industries Trump is likely to mention in his inaugural speech:

1.       Bitcoin Executive Orders

The world’s dominant cryptocurrency cleared the psychologically significant $100k mark this week amid reports that Trump will issue executive orders on the first day in office that will be crypto-related. Once a Bitcoin skeptic, Trump has warmed up to the industry and will even have a crypto-themed inaugural event. Meanwhile, fellow Republican and US Senator Cynthia Lummis has introduced “The BITCOIN Act” legislation, which would “serve as an additional store of value to bolster America’s balance sheet and ensure the transparent management of Bitcoin holdings of the US government.” Any mention of a Bitcoin strategic reserve by Trump would likely send the world’s largest digital asset soaring. The iShares Bitcoin ETF ((IBIT - Free Report) ) gained 11.52% for the week.

2.       Immigration & Detention Facilities

A core campaign promise of the Trump campaign is to put an end to rampant, unfettered illegal immigration. Trump has already tapped Tom Holman, a no-nonsense former immigration official, as his “border czar.” Depending on how aggressive Trump’s rhetoric is, stocks like secure facility operator Geo Group ((GEO - Free Report) ) may see some movement.

3.       China Trade Tensions Fester

Friday, Trump posted the following to his “Truth Social” platform: “I just spoke to Chairman Xi Jinping of China. The call was a very good one for both China and the U.S.A. It is my expectation that we will solve many problems together, and starting immediately. We discussed balancing Trade, Fentanyl, TikTok, and many other subjects. President Xi and I will do everything possible to make the world more peaceful and safe!” A trade dispute with China market Trump’s first term. However, if the two leaders can work out their differences, it would be a positive for Chinese stocks and the iShares China ETF ((FXI - Free Report) ).

4.       Unleashing US Energy to Feed AI Demand

Donald Trump has warned that the US will need to double its energy output over the next few years to satisfy the electrical needs that AI data centers demand. Scott Bessent, an investor, hedge fund manager, and President-Elect Donald Trump’s nominee for secretary of the Treasury, boosted nuclear stocks this week by saying that he favors more nuclear plants. A nuclear-friendly administration will be bullish for stocks like Oklo ((OKLO - Free Report) ).

5.       Semiconductors and the Race for AI Dominance

Trump is intent on winning the AI race and seems willing to do whatever it takes, including blocking Nvidia ((NVDA - Free Report) ) chips from being sold in China. Among the topics mentioned, semiconductors may be the biggest wildcard we get answers to during the inauguration speech.

Bottom Line

The political winds have shifted right as Trump gets set to deliver his inauguration speech. Investors should watch for industry clues in the speech about energy, China, AI, and more.

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