Stock Market Results: Early Trump vs. Early Obama

Nearly 3 Years After Donald Trump Was Elected President, Here’s How the Stock Market Has Performed Compared to Barack Obama’s First 3 Years. The Results Might Surprise You.

The morning after Donald Trump was elected President, liberal economist Paul Krugman penned an emotional op-ed in The New York Times claiming that the U.S. stock market would “never” recover from Trump’s surprise victory. Krugman was wrong, of course. Nearly three years later, stock market results have been largely strong under Trump, despite the massive market correction in the fourth quarter of 2018 and the net stasis of the past five-plus months.

Krugman’s doom-and-gloom assertion was ill-advised, but somewhat understandable considering how badly stock market futures cratered the night of the election; at one point, Dow futures were down more than 800 points! But investors came to terms with a Trump White House much quicker than Krugman had forecast: stocks were actually up the first day of trading after the election. Despite a rough 2018, and even with calls for impeachment reaching a fever pitch, the net stock market results have been positive since Trump was elected.

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A conservative-leaning friend of mine brought up Krugman’s wayward post-election assertion recently, scolding the economist for his obviously partisan bias in making such a bold claim in a publication as revered (at least by most) as The New York Times. So, in the name of balance – and keeping my own political leanings under full lock and key – I thought it might be interesting to compare Trump’s stock market results in the first (nearly) three years after being elected to the same period after Barack Obama was first elected in November 2008.

Two things to note: Prior to researching these results, I did not know (though I had a pretty good idea) how Trump and Obama’s early presidencies would stack up. Also, I used their respective election dates as the measuring stick, and went through mid-October 2011 for Obama, giving us essentially three full years of data for both.

Here’s what I found in each of the three major U.S. stock market indexes:

Early Stock Market Results (first three years after election)

S&P 500

Obama: +32%

Trump: +38%

Dow Jones Industrial Average

Obama: +32%

Trump: +43%


Obama: +60%

Trump: +55%

Surprisingly similar, huh? Large-cap stocks have performed slightly better in the first three years after Donald Trump’s election than they did under President Obama’s first three years after his election. The gap in Dow stocks is a bit wider. Growth stocks, however, favor President Obama slightly, as reflected in his five-percent advantage in the Nasdaq.

As with everything in the stock market, however, context matters. President Obama was elected in the midst of the worst economic downturn America has seen since the Great Depression, and he took office about six weeks before the market bottomed (and was elected four months before the bottom). Trump was elected amid almost universal U.S. growth: rising GDP, escalating home prices, and an unemployment rate (4.8%) that was less than half its late-2009 nadir (10%). So it’s far from an apples-to-apples comparison.

Regardless, the strong stock market performance since Trump’s election proves that the daily noise projecting Trump’s poisonous effect on stocks was not only overstated; it was simply incorrect.

Investors Ignoring Trump Drama

Until recently, Wall Street has tuned out most of the drama surrounding Trump. The impeachment inquiry and the ongoing trade war with China have seemingly held stocks in check the last few months, but those events haven’t sent markets spiraling downward, and the tariffs have put a much bigger dent in Chinese stocks (and other emerging markets) than U.S. stocks – though the domestic impact of the trade war seemed quite profound the last three months of 2018.

In the aggregate, very little of Trump’s bluster has scared investors away. Wall Street is instead focusing on the bottom line: an unemployment rate (3.5%) at its lowest point in a half-century, earnings growth reaching six-year highs in 2018 thanks to lowered corporate tax rates, GDP growth holding steady, etc.

The bottom line is this: Wall Street doesn’t care about who’s President as much as we think it does. As long as the economy is improving, companies are growing profits, and people are working, stocks tend to go up. That was the case shortly after Obama took office in 2009 and the long post-recession recovery ensued, and it’s been the case the last three years with Trump in office.

So don’t invest based on who’s in the White House – now or a little over a year from now. Buy stocks that you like, especially when times are good. And for the most part, times are good these days, despite the recent choppiness.

Chris Preston

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*This post was originally published in 2017 and is periodically updated.


  • I’m simply surpristed that the start dates used for each president in measuring market performance during their incumbency was their election dates and not their inauguration dates.
    The choice of the former strongly skews in trump’s favor, given the large equities runup to his inauguration, but does not speak simply to any link or correlation between their actual administrations’ policies or actions and the stock market indexes, but instead more accurately to a context adding initial public perception even before either president was in office. The author’s note of Obama’s inheriting a recession does some justice to the analysis, but nevertheless, neglects the boost that public perception of trump would have had even before his highly questionable economic policies once in-office. While I understand that the stock market picture is a much more complex ones than simply the effects of executive branch policies, still, even the snapshots provided here are not framed according to the best parameters.

  • William J.

    He (LAIR TAX CHEAT IGNORANT TRUMP) passed a huge welfare bill for corps AND has bullied the FED – market has been sideways under this horrendous leader and person

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