Who Had the Better Stock Market?
Saul Loeb / AFP / Getty Images
President Joe Biden meets with President-elect Donald Trump in the Oval Office of the White House in Washington, DC, on November 13, 2024.
Stocks rose on Friday, capping off a strong run for markets under President Joe Biden and putting equities near record highs ahead of Donald Trump’s inauguration on Monday.
The S&P 500 rose 1% on Friday, putting it up 58% since Joe Biden’s inauguration on Jan. 20, 2021. The S&P 500’s performance during Biden’s presidency fell short of its nearly 70% return (excluding dividends) during Trump’s first term. It also falls short of the more than 80% return registered in Obama’s first term, when stocks rebounded from the bear market of the Great Recession.
Biden’s presidency began as stocks were soaring off of their peak-Covid lows, lifted by stimulus checks, an influx of cooped-up retail investors, and ballooning profits at big tech companies. The rally Biden inherited came to an end when supply chain disruptions, soaring oil prices, and a huge supply of money contributed to the U.S.’s worst bout of inflation since the 1970s. Aggressive rate hikes by the Federal Reserve plunged stocks into a bear market, during which the S&P 500 lost about a quarter of its value. The launch of ChatGPT in late 2022 sparked the AI craze that has propelled stocks higher ever since.
Similarly, Biden’s presidency was a good time for the blue-chip Dow Jones Industrial Average, but not quite as good as Trump’s first term and Obama’s two terms. The Dow advanced more than 56% under Trump and rose almost 150% under Obama. However, Biden’s time in the White House was far better for Wall Street than George W. Bush’s tenure between 2001 and 2009 when the Dow lost about a quarter of its value.
On an annualized basis, Biden’s Dow performance is slightly below the 50-year average, but higher than the average among 20th and 21st-century Democratic presidents. Among one-term presidents, the Dow’s performance under Biden is the worst since Jimmy Carter.
Granted, a president has very little control over the stock market. Their statements may brighten or darken market sentiment, and their policies can benefit or harm certain industries. But Wall Street and its major indexes follow the ebbs and flows of the U.S. and global economies, on which a president’s imprint is rarely visible before they’re out of office.
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