Following Donald Trump's victory in the 2024 US presidential election, bank stocks and exchange-traded funds (ETFs) holding Bitcoin soared, while solar power generation ETFs and commodity ETFs fell.
Stocks rose on Wednesday; Morningstar US Market Index It increased by 3.9%. Small-cap stocks that underperformed in 2024 rose further. Morningstar U.S. Small Cap Index 5.5% increase.
winner of the election
Financials rose the most among 11 major stock sectors, with the $44 billion Financial Select Sector SPDR ETF XLF rising 5.9%. Bank stocks led the rise. The $3.4 billion SPDR S&P Regional Bank ETF KRE rose 8.24%, while the $2.1 billion SPDR S&P Bank ETF KBE, dominated by large banks, rose 12.4%.
Bitcoin also won big. On Wednesday, the $30 billion iShares Bitcoin Trust ETF IBIT rose 14.2%. Trump has widely embraced cryptocurrencies, particularly Bitcoin during his presidential campaign. For example, he suggested that cryptocurrencies could be used to pay down the national debt.
The second and third best performing sectors were industrials and energy, with the $20 billion Industrial Select Sector SPDR ETF XLI and $35 billion Energy Select Sector SPDR ETF XLE both up 3.9%.
Small-cap stocks were also big winners, with the $70 billion iShares Russell 2000 ETF IWM rising 5.49%, outpacing the $597 billion large-cap SPDR S&P 500 ETF Trust SPY, which rose only 2.4%.
election loser
Solar stocks were one of the most obvious decliners on the market after the election. On Wednesday, the $1.1 billion Invesco Solar ETF TAN fell 10.9%.
The worst performing sectors were the interest rate-sensitive real estate sector, with the $8 billion Real Estate Select Sector SPDR XLRE down 3.4%, followed by the $17 billion Consumer Staples Select Sector SPDR XLP, down 1.6% and $18 billion. Dollar utilities followed. Select Sector SPDR ETF XLU, which is down 0.77%. These are all defensive, dividend-focused sectors that often benefit from falling interest rates. Bond yields rose on Wednesday following Trump's victory.
Commodity stocks were also weak, with the $200 million U.S. Copper Index ETF CPER down 4.6%, the $78 billion SPDR Gold Stock ETF GLD down 2.8%, and the ICE USD Index up 1.6%. This made it expensive for buyers near the US market. world.
This article was created with the help of artificial intelligence and reviewed by Morningstar editors. Learn more about Morningstar's use of automation here.
