How Has the Stock Market Performed Since Trump Took Office? (7-Month Recap)

The stock market’s performance since Trump took office shows why traders must focus on price action first and headlines second. A rough start gave way to sharp reversals, sector rotations, and record highs that reward disciplined planning over prediction. If you respect volatility, manage risk, and trade the trend in front of you, you can adapt to this tape.

Cut to the chase — here are four Trump stocks to watch!

You should read this article because it explains how the stock market has performed in Trump’s second term with a clear 7-month breakdown, sector analysis, and comparisons to both his first term and Biden’s presidency.

I’ll answer the following questions:

• How did the stock market perform during the first seven months of Trump’s second term?
• Which sectors gained the most under Trump’s second-term policies?
• Which sectors struggled in Trump’s second term and why?
• How do Trump’s economic policies impact overall market performance?
• How does Trump’s second-term market performance compare to his first term?
• How does the stock market under Trump’s second term compare with Biden’s presidency?
• How have global markets responded to Trump’s second-term policies?
• Did all major stock indices rise during Trump’s seven-month period in office?

Let’s get to the content!

Stock Market Update at the Start of Trump’s Second Term

The stock market update at the start of Trump’s second term is a story of a fast “Trump bump,” a hard drop, and a measured recovery to new highs. After the inauguration, uncertainty around tariff policies hit returns, and the S&P 500 fell roughly 7% in the first 100 days, ranking among the worst early-term starts. That selloff fed extreme fear as inflation risk and higher interest rates pressured valuations. Then came stabilization as tariff implementation was delayed, the labor market cooled, and yields eased off their highs. By September, the S&P 500 was up nearly 10% since the term began and notched record highs.

I teach students to respect volatility as information. When rates, tariffs, and inflation data shift, I trade the actual price levels rather than argue with the news. The plan stays the same. Cut losses fast. Trade liquid names. Let the market confirm your thesis.

If you want to know what I’m looking for — check out my free webinar here!

7-Month Performance Summary (Month-by-Month Breakdown)

The 7-month performance summary starts with a choppy January finish and a shaky February as traders priced tariff headlines and stubborn inflation. March brought sideways action while yields stayed elevated and the unemployment rate held low but began flashing softening jobs data. April 2 exploded with “Liberation Day” tariff news and a sharp two-day drop that erased trillions in market cap. That shock reset expectations on growth, prices, and earnings.

May stabilized on tariff delays. June firmed as second-quarter earnings outlooks improved and rate-cut hopes crept back into the outlook. July printed mixed data, including weaker jobs and sticky prices, but tax extensions supported corporate profits. August pushed toward highs as traders rotated into stronger sectors and adapted to the new trade rate regime. I train traders to map each month by catalysts, liquidity, and risk range. You cannot control the administration, tariffs, or policies. You can control position size, entries, and exits as the data changes.

Stock Market Sector-Wise Breakdown in Trump’s Second Term

The stock market sector-wise breakdown in Trump’s second term shows uneven performance tied to tariffs, yields, and pricing power. Tech recovered from an early-year dip as companies with strong products and services regained momentum. Energy traced swings in global trade, while financials tracked interest rates and curve shape. Healthcare diverged on policy risk and margin pressure. Consumer discretionary moved with prices, credit costs, and the confidence hit from higher goods tariffs.

I teach a sector-first scan: identify leaders with catalysts, confirm with volume, and respect the risk from policy shifts. The administration’s tariff policies, import rates, and shifting negotiations with China, Japan, the European Union, and Canada fed market volatility. When inflation data ran hot and 10-year yields spiked, rate-sensitive groups lagged. When yields cooled and earnings beat, growth sectors led. Trade the leaders. Short the laggards into clean trend breaks. Keep a written plan for each sector and review it with fresh data.

Technology

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Technology performance in Trump’s second term has been a barbell of AI strength and tariff jitters. Nvidia pushed to new highs as earnings and demand supported price levels, while Palantir ripped on government and enterprise contracts. At the same time, earlier-year weakness hit parts of software and hardware when tariffs threatened costs and supply routes. Volatility widened ranges, which is a gift for traders who plan entries around prior highs and gaps.

I teach students to pair catalyst analysis with liquidity. When an administration moves tariffs, rate expectations shift, and the Nasdaq responds quickly in both directions. Focus on companies with clear products, sticky customers, and rising revenues that can offset import costs. Treat inflation and yields as a risk meter. If tech gaps up on strong reports and holds, ride the trend. If it fails at resistance on heavy volume, cut fast and wait for the next clean setup.

Energy

Energy performance has tracked global trade headlines, supply expectations, and capital discipline. Tariffs on goods and select sectors moved costs, while currency moves affected dollar-priced commodities. Companies with strong balance sheets and controlled spending weathered the swings better than high-cost producers. Services and equipment names were sensitive to project timing as firms weighed uncertainty in imports and exports.

In my trading, I treat energy as a catalyst-driven sector with clear levels tied to inventory, prices, and forward guidance. When the administration signals tariff changes with Canada or pressures China, shipping and input costs can ripple through. Inflation concerns support the space until yields spike and risk-off hits broad equities. If the tape rotates into cyclicals on a rate-cut outlook, energy beta can expand. Trade liquid leaders only. Do not overstay when the range breaks against you.

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Financials

Financials performance has reflected interest rates, yield curve shape, and credit quality. Early-term declines in the S&P 500 tracked with rising yields and policy uncertainty, which weighed on banks sensitive to funding costs and loan growth. As 10-year yields retreated from near 4.9% toward the low 4s, parts of the group stabilized. Insurers and asset managers responded differently based on flows, fees, and market volatility.

I teach reading the curve before trading the tickers. When inflation data firms and the Federal Reserve signals fewer rate cuts, net interest margins and valuations adjust. When jobs data softens and the unemployment rate edges up, recession risk gets priced. In this administration, tariff policies and the government’s fiscal plan added another layer. Trade high-liquidity names around earnings and guidance. Respect support and resistance from prior quarters. Size down when the curve is whipsawing.

Healthcare

Healthcare performance in Trump’s second term has been uneven due to policy pressure, reimbursement noise, and company-specific execution. Managed care and services saw margin stress from pricing questions, while select biopharma and medtech names held up on product cycles and innovation. Regulatory headlines can hit these companies harder than other sectors, and that demands tight risk control.

My teaching here is simple. Avoid guessing policy. Trade price and volume around real reports, guidance, and clear catalysts. The administration’s spending priorities and efforts to manage costs across programs influence the sector’s returns, but the trade comes from reaction at key price levels. If a healthcare stock gaps down on a bad report and fails to reclaim support, short into bounces. If a product approval with real revenue potential triggers buyers and holds above prior highs, ride with a trailing risk. Stay nimble.

Consumer Discretionary

Consumer discretionary performance ties directly to prices, rates, and confidence. Tariffs on imports raise costs across goods, while sticky inflation challenges lower-income consumers. Retailers with strong supply chains and pricing power managed better. Big-ticket items tied to financing faced pressure when yields were high. As the labor market softened and jobs gains slowed, discretionary spending became more selective.

I always tell students to watch inflation data and credit trends before trading retailers and consumer names. When the administration adjusts tariff rates or extends talks with key partners, cost visibility changes and that shifts guidance. If prices stabilize and the rate outlook improves, the group can rally hard off oversold levels. Look for companies that protected margins and maintained inventory discipline. Trade earnings gaps in liquid names only. If the gap fails, step aside quickly. The goal is asymmetric risk, not heroics.

Winners and Losers by Sector

Winners and losers by sector reflect policy risk, pricing power, and execution. Tech winners included Nvidia and Palantir. Both held trend on strong earnings and clear demand. Defense-related names like Howmet Aerospace gained on spending and contracts. On the loser side, Tesla saw large swings and net losses over the first six months. Trump Media and Technology Group dropped sharply from its start-of-term levels.

Here’s how I frame stock picks in this tape. Nvidia: thesis is sustained AI demand, high gross margins, clear catalysts each quarter. Risk is valuation and export limits. Plan is buying high and selling higher when prior highs hold with volume. Palantir: thesis is expanding government and commercial deals. Risk is multiple compression. Plan is trading breakouts only, no chasing when volume fades. Howmet: thesis is defense and aero demand. Risk is budget or tariff shocks. Plan is buying pullbacks to prior support. Tesla and DJT: avoid when price trends make lower highs and volume confirms sellers. No forced trades.

Trump’s Economic Policies and Their Impact

Trump’s economic policies and their impact show up in tariffs, taxes, and regulatory moves that hit companies, consumers, and prices. The administration has relied on elevated tariff policies across imports from China, Japan, the EU, and others, with effective rates around the low double digits and sectoral peaks on metals. That raised costs, pushed some inflation back up to around 2.9%, and kept market volatility elevated. The One Big Beautiful Bill Act extended tax cuts, supporting corporate earnings and cash flows, even as deficits and borrowing needs kept yields sticky.

I teach traders to separate narrative from tape. Policies affect the cost of goods, services, and supply chains, which filters into margins and returns. But the entry is always about level, liquidity, and catalyst. When policy shocks hit, expect gaps and wider ranges. Size down, then scale when the market confirms direction. Policy can bend the trend. Price confirms it.

Stock Market Performance Comparison Since Trump’s First Term

The stock market performance comparison since Trump’s first term shows a calmer early run in Term One and a jumpier path in Term Two. Pre-pandemic, major indices pushed to highs. After the COVID drop, markets recovered and posted strong annualized returns into the handoff. In the current term, the first 100 days brought a sharp decline tied to tariff shock, then a recovery to record highs as traders adjusted and earnings and tax extensions supported growth. The path is rougher, but the trend has been up since the April reset.

In my teaching, I stress context. Different terms bring different risks. In this administration, tariffs, inflation, and rates moved faster. That means tighter stops and faster decision-making. When the S&P 500 builds higher lows after a hard drop, that is actionable. When yields roll over from highs and inflation data cools, growth stocks can lead again. You do not need to predict the presidency. You need to execute your plan with discipline.

Trump’s Second Term Vs Biden’s Stock Market Performance

Trump’s second term vs Biden’s stock market performance comes down to path and policy mix. Biden’s years saw big gains powered by post-pandemic recovery, fiscal support, and the early AI boom. Trump’s current term started with a tariff shock that hit returns early, then bounced to new highs as traders priced a new trade regime, tax extensions, and potential rate cuts. Both periods printed strong tech leadership at times, but the policy drivers differ. Tariffs and trade headlines now sit alongside inflation and yields as daily catalysts.

I coach traders to compare conditions, not personalities. Under Biden, liquidity and growth supported higher multiples. Under Trump’s second term, policy risk increased market volatility and pushed sector rotations. For trading, that means quicker profit-taking on extensions and letting only the best setups run. Focus on the indices’ higher time-frame trend and the jobs and inflation reports that move rate expectations. Trade what’s in front of you.

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Global Market Response to Trump’s Second Term

The global market response to Trump’s second term has featured currency swings, tariff repricing, and country-by-country negotiations. The dollar slipped from spring highs as growth concerns and legal fights around tariff authority grabbed headlines. Europe and Japan reached targeted trade understandings, including a 15% rate framework in areas, while steel and aluminum maintained sectoral tariffs near 50%. Talks with China remain sensitive, and Canada faces selective import pressures that filter into North American supply chains.

In my process, global headlines set the opening tone but price action sets the trade. When the administration signals a new tariff plan or an extension, international equities and U.S. multinationals gap, yields shift, and risk appetite moves. That is where I look for liquid sympathy plays by sector, not country guessing. If global risk softens and U.S. indices hold support, I favor leaders with overseas revenue that can pass through costs. If headlines escalate, I cut risk and wait.

Key Takeaways

• Volatility rose on tariff policies, inflation worries, and rate uncertainty, then the market adapted and pushed to highs. Sector performance split on pricing power and policy exposure. Tech and defense showed strength. Financials and healthcare traded more selectively. Consumer discretionary tracked prices, wages, and credit costs.
• I teach a repeatable process. Track catalysts like CPI, jobs, Fed meetings, and tariff news. Anchor entries to prior highs and well-defined support. Trade liquid companies in leading sectors. Keep losses small when the tape turns and press winners only when volume confirms. 
• The administration, the president, the government, and the data will keep changing. Your plan should not. It should adjust position size and timing, not your rules.

This is a market tailor-made for traders who are prepared. Political change drives volatility, but it’s up to you to capitalize on it. Stick to your plan, manage your risk, and don’t let FOMO drive your decisions.

These opportunities are fast and unpredictable, but with the right strategy, you can make them work for you.

If you want to know what I’m looking for—check out my free webinar here!

Frequently Asked Questions

How should beginners trade a market flipping between bull and bear signals during a potential downturn?

Treat mixed bull and bear signals as a warning to cut size and tighten risk during any suspected downturn. Prioritize liquid leaders and avoid weak industries that fail to reclaim prior highs after sharp selloffs. Use clear levels for entries and stops, and let strength prove itself before you add.

Which industries look most sensitive to tight money conditions in the United States right now?

Rate-exposed industries like housing, regional banks, and consumer durables tend to wobble when money is tight in the United States. Companies that rely on financing and long order cycles usually see slower demand and thinner margins. Focus on pricing power and balance sheets first, then trade only when volume confirms the trend.

What’s a simple way to structure a trading portfolio around major events without confusing trading with investments or small business goals?

Segment your portfolio by time frame, so events like CPI or tariffs don’t derail unrelated positions or long holds you label as investments. Keep trading capital separate from any business cash needs to avoid forced exits. Size positions so one bad headline cannot take you out of the game.

How do policies under Donald Trump and Joe Biden shape short-term trading edges in the United States, and why does this article stress process over prediction?

Policy shifts under Donald Trump and Joe Biden move rates, tariffs, and sector flows in the United States, which creates tradable volatility. The edge comes from reacting to price, not guessing the next press conference. This article keeps the focus on rules, risk, and execution because that’s what compounds consistency.