London Daily

Focus on the big picture.
Wednesday, Aug 12, 2026

Wall Street is busy trying to figure out how to profit from a Biden presidency

Wall Street is busy trying to figure out how to profit from a Biden presidency

Joe Biden will be the 46th president of the United States -- and Wall Street is busy trying to figure out how to profit from that.

Monday's big market rally likely had more to do with the reported efficacy of the Covid-19 vaccine that Pfizer (PFE) and BioNTech (BNTX) are working on than Biden's victory.

But market strategists say investors need to start preparing for how a Biden presidency will impact certain sectors.

Infrastructure and solar set to shine


Solar companies and other leaders in the alternative energy industry are poised to be among the bigger beneficiaries of a Biden White House, but that potential windfall may already be priced into the stocks.

The Invesco Solar ETF (TAN) -- which trades under the appropriate ticker symbol TAN -- surged nearly 40% in the past three months on anticipation of a Biden win but has pulled back so far this week. The ETF owns big positions in SolarEdge Technologies (SEDG), First Solar (FSLR) and Sunrun (RUN).

Investors are also betting (and you've likely heard this before) that there will finally be a renewed focus in Washington on passing a big infrastructure spending bill.

There were hopes that the Trump administration would make infrastructure improvements one of its economic priorities, but that never happened. However the need to upgrade highways, railroads and bridges is even more pressing now given the jobs crisis brought on by the pandemic.

The Global X U.S. Infrastructure Development ETF (PAVE) has rallied this week and is up more than 15% over the past three months.

The fund owns stocks such as building supplies manufacturer Fastenal (FAST), construction software firm Trimble (TRMB), power management company Eaton (ETN) and the big railroads CSX (CSX), Union Pacific (UNP), Norfolk Southern (NSC) and Kansas City Southern (KSU).

Experts also point to the fact that Biden, as vice president under Barack Obama, has experience helping the economy recover from a recession.

"Investors should take some solace in the notion that Biden will be in somewhat familiar waters as he begins his Presidency," said Jeff Schulze, investment strategist at ClearBridge Investments, in a report. "As Vice President, Biden took office in the midst of the global financial crisis and helped steer the economy back into an expansion characterized by steady but slow economic growth."

Funds focusing on environmental, social and governance (ESG) issues have also rallied in the past few weeks on expectations of a Biden win. The ESG wave is even impacting the fixed income market. State Street launched a new ESG-focused ETF dedicated to corporate bonds on Tuesday.

Cannabis stocks have also surged as hopes increase for federal decriminalization of recreational marijuana.

The new regime in Washington may also have an impact on the market beyond specific industries and sectors.

Value over growth


Biden's win could usher in a change in the types of investments that drive the overall market. Value stocks may once again thrive while tech and other high growth stocks finally see a slowdown in their epic gains.

"There could be a shift to value sectors like health care," said Andrew Rosen, president of Diversified Lifelong Advisors, in an interview with CNN Business.

"It's healthy to see the recent tech pullback. There needs to be more diversification."

Valuations for tech and other growth stocks may also come under pressure if the economy continues to rebound next year -- a scenario that could pick up pace once a Covid-19 vaccine becomes widely available.

Investors may soon rotate back into hard hit consumer stocks, many of which still pay solid dividends despite the pandemic. With that in mind, defensively oriented stocks -- companies with lots of cash and little debt -- could thrive.

"Companies with stable balance sheets, reliable cash flows, and the capital to bridge the gap created by Covid-19 would outperform," said Lauren Goodwin, economist and multi-asset portfolio strategist with New York Life Investments, in a report Monday.

International stocks, particularly those in markets like China that were a main target of Trump's trade wars, could rebound too.

"Emerging markets could benefit from less of an 'America First' policy under Biden," Rosen added. "He may try to fix some international relationships to pave way for less acrimonious trade policies."

Despite the early returns, it may be unwise to focus too heavily on how markets are doing in the immediate aftermath of the election. Short-term successes could also become longer-term investing flops.

"Financials were the best-performing sector on the day after the 2016 election, and that group, along with energy, were the top two over the ensuing month," ClearBridge's Schulze noted. "While these groups continued to show strength into early 2017, they have been two of the three worst-performing sectors since."

Newsletter

Related Articles

0:00
0:00
Close
Former Labour Adviser Arrested on Suspicion of Spying for China Held Privileged Access as Top Party Donor
Turkish Parliament Passes Landmark Bill Granting Conditional Amnesty to Disarmed PKK Members
Donald Trump Warns FIFA Against Ousting Gianni Infantino Amid Revolt by Global Football Leaders
Jeff Bezos Joins Investor Group Closing In on $6 Billion Liverpool FC Stake
Police Conduct Cross-Border Raids Against Northern England Drug Network
Nicola Sturgeon Protested at Edinburgh Festival Fringe Event
Major UK Retail Chain Enters Administration With One Hundred Fifty-Four Stores Set to Close
Heathrow Renews Call for Runway Expansion After Losing Europe’s Busiest Airport Ranking
Government Condemns One Million Pound Thames Water Executive Bonus Amid Drought
NHS England Says More Than One Hundred Thousand Hepatitis C Patients Have Been Cured
UK Foreign Secretary Ed Miliband Calls for End to West Bank Settler Violence
UK Prepares for Deepest Partial Solar Eclipse Since Nineteen Ninety-Nine
UK Heatwave Triggers Amber Health Alerts as Economic Losses Reach Four Point Four Billion Pounds
UK Offers Electricity Bill Discounts to Communities Hosting New Power Infrastructure
Bank of England Expected to Hold Interest Rates at Three Point Seven Five Percent
UK Government Moves to Ban Subscription Traps and Misleading Retail Discounts
Andy Burnham Gives Councils New Powers to Block Betting and Vape Shops
UK Councils to Receive Sweeping Planning Powers to Ban New Vape and Betting Shops
Nicola Sturgeon Says She Has No Contact With Estranged Husband After SNP Embezzlement Case
Police Arrest Two Men After Aberdeenshire Defense Technology Office Break-In
Greater Manchester Councils Gain Powers to Restrict New Vape and Betting Shops
Coroner Finds Treasury Workplace Failures Contributed to Personal Assistant’s Suicide
English and Welsh Courts Ban Meta Smart Glasses Over Recording and Privacy Risks
Strait of Hormuz Disruption Could Double UK Inflation and Trigger Recession, Forecasters Warn
UK Expands Global Talent Visa Scheme to Support Research-Intensive Companies
UK Equity Funds Suffer Record One Point Six Billion Pound Outflow Amid Capital Gains Tax Fears
Three-Quarters of England Enters Drought as Fifth Summer Heatwave Raises Economic Risks
UK Hiring Stabilizes for First Time Since 2022 as Employers Adjust to Higher Payroll Costs
UK Chancellor Orders Whitehall Spending Cuts as Public Debt Exceeds Three Trillion Pounds
UK Manufacturing Output Records Fourth Straight Month of Growth
UK Condemns Russian Torture of Ukrainian Prisoners and Recruitment of Foreign Nationals
Long-Lost Royal Navy Warship HMS Tiger Found in English Channel After 118 Years
Northern Ireland Finance Minister Seeks Urgent Treasury Talks Over Regional Budget Pressures
UK Government Targets Subscription Traps and Misleading Discounts in New Consumer Rules
Alleged Cartel Boss Daniel Kinahan Extradited From Dubai to Face Criminal Charges
AI Chatbots Challenge Traditional News Consumption and Raise Job Concerns
Andy Burnham Government Promises Crackdown on Exploitative Business Practices
UK University Funding Model Faces Growing Pressure From Unsustainable Student Debt
Government Urged to Subsidise Energy Bills for Vulnerable UK Households
UK Military Spending Plans Threaten to Deepen Infrastructure Funding Gap
Israeli Government Rejects US Peace Framework for Gaza
New Labour Government Signals Closer Economic and Strategic Ties With European Union
Amber Heat-Health Alerts Issued Across England as Temperatures Threaten 36 Degrees
UK Economy Expected to Grow Despite Energy and Supply Chain Shock From Iran Conflict
Foreign Social Media Accounts Drove Disinformation During Belfast and Southampton Riots
Record Number of Migrants Cross English Channel in Single Vessel as Smugglers Deploy Mega-Dinghies
Russia’s A7 Builds a State-Linked Payments Network Beyond Western Sanctions
Reports of Mark Zuckerberg-Linked Superyacht Declining Rescue Assistance Draw Maritime Scrutiny
Preserving Three Banksy Artworks in London Has Cost Taxpayers Nearly £150,000
Four Ugandan Athletes Disappear From Delegation After UK Sporting Events
×