Investors will be closely monitoring the performance of U.S. stock market on Tuesday (today), following Donald Trump’s inauguration for his second term as president.

Market participants are eager to see whether equities can continue their recent trend of gains after a presidential inauguration.

Historically, the benchmark S&P 500 index has not performed strongly on average on inauguration day or the day after, especially if the inauguration coincides with a market holiday.

However, the last three inaugurations have resulted in market gains. Trump’s first inauguration in 2017 saw the S&P 500 post a 0.34 per cent gain, while the index surged by 1.39 per cent on the day Joe Biden was sworn in, marking the largest inauguration-day gain since Ronald Reagan’s second term in 1985, according to Reuters.

Despite these recent gains, long-term data suggests a different trend. The S&P 500 has posted an average decline of 0.27 per cent on inauguration days, based on historical data dating back to 1949. The Dow Jones Industrial Average has seen a similar trend, with an average decline of 0.24 per cent, while the Nasdaq Composite, launched in 1971, has logged a larger average drop of 0.35 per cent.

The stock market’s reaction on the first trading day after Trump’s second inauguration will be closely watched, as it could set the tone for the rest of his term.

The PUNCH reported that Donald Trump confirmed that his inauguration as US president on Monday will move indoors due to expected freezing weather, undercutting the Republican’s hopes for a grandiose spectacle to kick off his second term.

All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from PUNCH.

Contact: [email protected]