It may be hard to believe, but depending on your perspective and/or political bent, it has already (or only) been six months since President Trump’s inauguration in January. With that in mind, we looked to see how the stock market’s return under Trump’s tenure stacks up relative to that of other US Presidents since the start of 1900. Have stock market returns really been as “yuge” as purported to be? The table and chart below help to answer that question, as it shows the historical returns of the DJIA during each President’s first six months in office.
There are a number of ways to interpret these results, but in the broadest sense, the 9.1% return of the DJIA during Trump’s first six months in office is really nothing to write home about. Of the 20 Presidents shown in the table and chart, Trump only outperforms the overall median (8.4) by less than one percentage point. Furthermore, plenty of other Presidents have seen much stronger returns during their first six months in office. The DJIA rose 92.5% during FDR’s first six months, while Taft and Hoover both saw the DJIA rally more than 20%. Even more recently, three of the last four US Presidents saw a stronger rally by the DJIA than Trump during their first six months in office. The only recent President to see a smaller gain in his first six months in office was the second President Bush.
While the DJIA’s performance under President Trump is right in line with the historical norm, it is much better than past Republicans. As shown at the bottom of the table, the median return of the DJIA for all Republican Presidents during their first six months in office was a decline of 0.6%, so Trump is outperforming here by a wide margin. Additionally, in the post-WWII period, the only Republican President that presided over a bigger gain in his first six months was the first President Bush. So far at least, the stock market’s performance during the President’s first six months in office compares more closely to the 10.3% median return that the DJIA has seen during the first six months of Democratic terms.
Finally, we would make note of two things. First, one could easily argue that the 9.1% gain so far under Trump is understated since the DJIA rallied “bigly” in the period from the election through the inauguration. That’s definitely true, but it’s hard to measure returns in this manner, since a number of Presidents listed weren’t actually elected. (i.e., Johnson, Ford, etc) Long story short, this is an imperfect way to measure returns, but it’s still standard across all Presidents. The second thing to note, of course, is that returns during a President’s first six months in office don’t always mean there are more gains to come! Take the first President Bush, for example. In his first six months in office, the DJIA rallied 15.2%; however, by the end of his term, the US economy was in a recession.
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