The U.S. stock market has added nearly $6.9 trillion in market cap since President Donald Trump was elected, already close to half of what was added in all eight years of President Barack Obama’s tenure.
The market cap, based on the Russell 3000, surpassed $30 trillion for the first time last week and was at $30.6 trillion Thursday, according to Bespoke.
“I think the performance in the first year has exceeded almost everybody’s expectations,” said Paul Hickey, co-founder of Bespoke. Hickey uses the Russell 3000 to measure overall market cap, since it represents about 98 percent of all U.S. stocks.
When Trump was elected, stocks rose out of the gate after an initial late-night collapse in futures prices. After that, the market rewarded stocks and sectors that would benefit from the “Trump trade” and Trump’s pro-growth policies.
The Trump trade occasionally stalled out when it looked as though tax reform was unlikely, but since the legislation began seriously moving forward and finally became law at the end of last year, the market has been on a tear. The S&P 500 has added 4.6 percent just since the start of this year, after last year’s near 20 percent move.
The market’s value may have reached peak levels since Trump’s election, but in percentage gains since inauguration, Obama was ahead in the first year. From his first inauguration until one year later, the S&P gained 41 percent under Obama. Hickey said the first-year average gain for first-term presidents since 1928 has been 13 percent.
Trump’s track record is still strong, he said. “As far as performance is concerned, it was a very good first year, seeing a gain of 23 percent in the S&P 500 in Trump’s first year in office,” said Hickey. “There were bigger gains under FDR and Obama, but they had the benefit of coming in at a low level, at the late stages of a bear market.”
Trump has not been shy about taking credit for a strong stock market, which some see as a risky prospect because stocks don’t always go up, as George W. Bush saw during his administration. The market lost $3.3 trillion in value in the Bush years, as measured by the Russell 3000, while it gained $12.3 trillion during the Obama administration.