The soaring U.S. stock market and the new Trump administration have investor optimism higher than its been in months.
The Dow Jones set a record as it ticked above 20,000 Wednesday morning, breaching the 20,000 mark for the first time in its history. The historic trading day happened just five days into President Donald Trump’s first term in office.
As the market made significant improvements last week, so did the economic outlook of the investment community. Optimism surrounding the economy of the wealthiest American investors has ticked up by 50 percent since Trump defeated former Secretary of State Hillary Clinton, according to research conducted by UBS Wealth Management Americas. In fact, investor optimism is at its highest point since before the Great Recession of 2007.
Not only has Trump improved investor optimism, but he has them changing their expectations and investment strategy just one week into his presidency.
Some 68 percent of investors said they expect Trump’s policies to produce strong returns in the stock market. The majority of investors are acting upon these expectations, with 55 percent actively seeking investment opportunities, up from 34 percent immediately following the election, UBS reports.
“Investors have high expectations of the new administration, particularly with regard to deregulation, infrastructure spending and tax reform,” Sameer Aurora, head of Client & Investor Insights for UBS-WMA, said in a statement. “These expectations are fueling a sharp rise in optimism and prompting investors to put more of their money to work.”
Trump’s supporters, unsurprisingly, saw the largest boost in economic confidence after the president won in Nov., improving from 25 percent prior to the election to 79 percent post-election, UBS reports. Clinton supporters confidence immediately fell from 57 percent to 34 percent after the election, but have seen it slowly recover to 41 percent in recent weeks.
Large investors are not the only ones considering plays in the market under the new administration. Small business confidence in the economy has also increased since Trump defeated Clinton. Small businesses, like large investors, expect some significant opportunities for growth under Trump, UBS reports. Small business owners note improved confidence in hiring new workers and reinvesting in their business
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