When the DJIA first started flirting with 20,000 over a month ago, it seemed like a near certainty that the index would reach that milestone before Donald Trump’s inauguration on 1/20. On the eve of his swearing in, though, Dow 20K remains on the to-do list. If historical returns for equities on the day newly elected presidents have been inaugurated is any indication, it is looking like Dow 20K will have to be an item for the first 100 days rather than the transition.
The table below lists the S&P 500’s one day return on the day that every newly elected President since 1928 has been inaugurated (Presidents who assumed office mid-term were not included). Of the eleven Presidents highlighted, nine were inaugurated on days where the market was open, and looking at the results, these haven’t been particularly good days. Overall, the S&P 500 has averaged a decline of 1.05% on these days with a median decline of 0.40%. The two worst Inauguration Days for the S&P 500 since 1928 were the days that Reagan (-2.02%) and Obama (-5.28%) were first sworn in. On the upside, the only two Presidents that got off to a positive start with their time in office were Eisenhower (+0.50%) and Kennedy (+0.32%), and in each case the gains were relatively modest. If the DJIA is going to get to 20K before the end of the week, bulls are going to have to make Inauguration Days great again.