Trump and Harris portfolios to play the election winner, according to Strategas Research

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Trump and Harris portfolios to play the election winner, according to Strategas Research

The U.S. presidential election is just a few days away, and Strategas believes some select names are due to perform well depending on the outcome. As it stands, former President Donald Trump and Vice President Kamala Harris are in a ***** heat, per a recent NBC News poll . Seeing that the election is already moving various areas of the market, the firm unveiled stock baskets that could outperform depending on the winner. “We continue to believe this is the most investable election of our lifetimes,” analyst Daniel Clifton wrote in a recent note to clients. “The differences between Trump and Harris are as wide as we have ever seen.” That’s because four of the six areas investors are eyeing most are centered around trade, foreign policy, regulation and immigration, he said. Differences in trade policy specifically, he said, are going to “determine where growth and earnings take place around the world.” When it comes to trade, Trump’s agenda features hardline tariff proposals , especially with regards to China. The *********** nominee said earlier this year he’s considering imposing tariffs of 60% or higher on ******** goods. Under this protectionism stance, Clifton has somewhat of a contrarian stance on which parts of the market could do well. “The old investment playbook of elections is no longer relevant, Clifton said. “For example, banks are often cited as the number one investment for a Trump victory. But banks are benefitting from Basel III being watered down and the Fed cutting rates. Instead, tech has been the big winner with Trump.” Clifton likes Invesco QQQ Trust – an exchange-traded fund that tracks nonfinancial companies on the Nasdaq 100 Index – as well as the iShares MSCI India ETF and Cleveland-Cliffs . Those funds have surged more than 18% and 12%, respectively, this year, while Cleveland-Cliffs has fallen 35%. Immigration enforcement is another key area of focus for Trump, as the candidate has fanned concerns over undocumented immigrants and the Southern border , pledging to rectify them by launching the ” largest deportation operation in the history of our country ,” he said. Clifton thinks Axon Enterprise is a notable beneficiary of this area if Trump wins. The provider of law enforcement technologies has soared about 64% year to date and more than 41% in the past three months. Although Wall Street is largely bullish on the stock, with 14 of the 16 analysts covering it having a strong buy or buy rating, its average price target implies around 3% downside from Thursday’s close. Lazard is another notable name for a Trump victory in the mergers & acquisitions space, given that industry members have indicated that a potential Trump administration could be more favorable to mergers activity . In 2024, shares have risen more than 52%. In contrast to Trump’s trade policy, reduced trade tensions under Harris could lead to gains for FedEx , which has advanced more than 8% this year. Harris has criticized Trump’s tariff strategy, calling it the ” Trump sales tax .” The outcome of the election could also change the trajectory in clean energy, and a Harris victory could mean more stability for the renewable energy tax credits implemented under the Biden administration’s Inflation Reduction Act. “I am proud that as vice president over the last four years, we have invested a trillion dollars in a clean energy economy while we have also increased domestic gas production to historic levels,” Harris said during September’s debate. While Trump said during the debate that he’s a “big fan of solar,” he also criticized the current administration’s energy policy, saying that “fossil fuel will be *****” if he loses this November. Solar stocks rallied after the Street declared Harris the winner of the debate, and one name that Clifton likes in particular is NextEra Energy . Shares of that renewable energy company have gained more than 30% in 2024, and the majority of analysts on the Street are bullish. Among the 24 analysts covering it, 16 have a strong buy or buy rating. Additionally, its average target reflects more than 12% upside, as of Thursday’s close. During that debate, Harris also accused Trump of gearing up to abandon support of Ukraine. To date, the U.S. has provided more than $64.1 billion in military assistance since Russia’s invasion in 2022. If Harris were to win the election, Clifton believes RTX is beneficiary of continued U.S. support of Ukraine. RTX shares have moved nearly 44% higher this year.

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