Regarding the economy, the Trump administration made three main promises:
- Lower taxes
- Higher Tariffs
- Less regulation
Today, we will focus on deregulation. The main idea of deregulation is to stimulate growth of the economy by reducing government oversight, particularly in industries such as banking, cryptocurrencies, artificial intelligence (AI), and the oil and gas sector.
Banking Sector
The first area of deregulation is the banking sector, which saw a significant bump after the election. During the past 12 months, the XLF (Financial Sector ETF) was already performing well with a gain of 35%. After Donald Trump’s election, the index experienced a nice jump, rising about 6.5% in just one month.
Cryptocurrencies
Bitcoin has increased from $88,701 to $101,461 since the election, representing a 14% gain in one month.
Artificial Intelligence
All companies related to AI are seeing gains. This includes tech giants such as Microsoft, Alphabet, Meta, Amazon, Nvidia, and OpenAI.
Oil and Gas
One of Donald Trump’s campaign promises was to allow oil companies to “Drill, baby, drill,” aiming to increase U.S. oil independence and increase profits. This sector is highly volatile. After the election, it initially rose but then returned to its pre-election level.
Investment Opportunities
Given these trends, here are potential investment strategies:
- Energy Stocks: Companies in oil and gas exploration and production, such as ExxonMobil and Chevron, are likely to thrive under deregulation.
- Technology Firms: Focus on AI companies with strong innovation pipelines and market positioning, such as Nvidia, Alphabet, and Tesla.
- Financial Institutions: Large banks and fintech firms stand to benefit from relaxed regulatory constraints, making them attractive investments. JPMorgan Chase, Bank of America, and Wells Fargo are notable examples.
Previous stock market posts
Leave a Reply