Crypto stocks, gun stocks and shares of other companies that could benefit from a Donald Trump presidency are up after an assassination attempt on the Republican candidate boosted expectations he would win the November election.
Trump’s survival after he was shot in the ear during a rally in Pennsylvania on Saturday increased his already considerable lead in betting odds on Monday over United States President Joe Biden.
On politics wagering website PredictIt, contracts for a Trump election victory traded at 68 cents on Monday, up from 60 cents on Friday, with a potential payout of $1. Contracts for a Biden victory were at 26 cents.
Shares of Trump Media & Technology Group, majority-owned by Trump, soared 30 percent, lifting the company’s stock market value to $7.6bn, despite its revenue being comparable to that of two Starbucks stores in the US.
Trump Media is the parent company of social media platform Truth Social, and its shares have now surged 129 percent in 2024 as retail traders bet Trump will win a second term as US president. He previously served from 2017 to 2021.
“It’s nearly four months to go [until the election] and things can change, but today the markets are betting on Trump being the victor,” said Ben Laidler, head of equity strategy at Bradesco BBI, adding that Trump Media “is the tip of the spear and the most sensitive to a Trump victory.”
Shares of electric vehicle maker Tesla jumped 5.2 percent after billionaire CEO Elon Musk publicly endorsed Trump following the shooting.
Crypto stocks soared, tracking a 10 percent rally in Bitcoin to a two-week high. Trump has presented himself as a champion of cryptocurrency. Crypto exchange Coinbase Global and Bitcoin miners Riot Platforms and Marathon Digital jumped over 10 percent each.
Long-dated US bond yields rose on expectations that Trump policies would drive up government debt and stoke inflation, while the benchmark S&P 500 edged 0.5 percent higher, nearing another record high.
“Most investors are not changing their overall commitment to US equities. After all, the broad stock market rose under the last Trump administration and has risen under the Biden administration as well,” said Rick Meckler, partner at Cherry Lane Investments.
Stocks jump
Gun makers and ammunition stocks Smith & Wesson Brands, Sturm Ruger & Company and Ammo jumped between 7 percent and 15 percent. Gun stocks in the past have surged following mass shootings, civil unrest and fears of gun control that have led people to buy more firearms out of fear that their availability would become limited.
Shares of private prison operators Geo Group and CoreCivic each jumped about 8 percent. Both are potential beneficiaries of a Trump presidency as he has promised to crack down on illegal immigration, which could boost demand for detention centres.
Software developer Phunware, hired by Trump’s 2020 presidential re-election campaign to build a phone app, gained 4 percent, while video-sharing platform Rumble, popular with conservatives, added 13 percent.
Clean energy stocks slipped as Trump has said he would reverse many of the Biden administration’s signature climate policies, including tax incentives, if he wins the election.
The Invesco Solar ETF fell 5.6 percent and the iShares Global Clean Energy ETF fell 3.7 percent.
The iShares MSCI China ETF dropped 2 percent. Investors believe a second Trump presidency could fuel trade tensions between Beijing and the US.
US voters view Trump as the better candidate for the economy, according to Reuters/Ipsos polls, even as Biden’s White House seeks to benefit from a solid economy with inflation slowing and low unemployment.
“In the absence of any real policy proclamations from Trump, traders are finding themselves having to speculate,” said Mark Malek, chief investment officer of Siebert Financial Corp.
“A second Trump presidency would mean expansionary economic stimulus in general, lower income taxes, less regulation, and increased tariffs.”