It’s been just 100 days since President Joe Biden’s inauguration — and a powerful S&P 500 rally is ongoing. But not all winners are equal. Far from it.
Shares of small companies like consumer discretionary play GameStop (GME) and Callon Petroleum (CPE), plus some offbeat S&P 500 technology companies like Seagate Technology (STX), stand as the biggest winners under the new administration, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. They’re up the most, by far, in the 100 days since Biden was sworn in.
To be sure, Biden’s term so far has been bullish for most S&P 500 investors.
The SPDR S&P 500 ETF (SPY) is up 10.9% in the past 100 days. That’s a stellar debut, topping what the S&P 500 usually returns in a full year, says Sam Stovall, strategist at CFRA. He says the S&P 500’s reaction to Biden’s first 100 days is the second strongest to a first-term president since World War II (trailing only President Kennedy in 1961). And it’s well above the S&P 500’s average 1.9% gain in the first 100 days of first-term U.S. presidential administrations.
All told, investors made $3.6 trillion from the Biden inauguration, says Wilshire Associates. And that’s just the average.
“Since January 20, if the stock market’s return is any indication, Wall Street appears to approve of President Biden’s attempts to corral the Covid-19 virus and stimulate the economy,” Stovall said.
Beyond The S&P 500: Rise Of Small Companies
If there’s one big takeaway from Biden’s first 100 days, it’s that there is life beyond the S&P 500. Small companies turned into the market’s superstars.
The SPDR Portfolio S&P 600 Small Cap ETF (SPSM) is up 11.4% in Biden’s first 100 days. That easily outperforms the S&P 500. But it actually masks some stellar runs from smaller firms in the past 100 days. More than 60% of the top 20 stocks in the S&P 1500 in that time, which includes stocks of all sizes, are small caps. And some of the runs are impressive.
Swept up by support on online forums like Reddit, S&P 600 Small Cap member GameStop jumped more than 340% under Biden. That gain put more than $10.5 billion into investors’ pockets, despite words of caution from analysts’ covering the stock. GameStop, a video-game seller, is attempting a turnaround. A big winner? Chewy founder Ryan Cohen owns more than 9 million shares of GameStop. His stake alone jumped $1.2 billion in value the past 100 days.
Similarly, small cap energy firm Callon Petroleum is a big-time winner. Shares of the Houston-based oil exploration firm jumped nearly 150% in Biden’s term so far.
Callon is a double winner. It’s a small-cap company worth $1.2 billion, putting it in the sweet spot with investors looking to play the economy’s reopening. But it’s also benefiting from a jump in oil prices. The United States Oil Fund (USO), which tracks the price of oil, is up 24%. Kimmeridge Energy Management, which owns 12% of Callon’s stock (more than anyone), is up roughly $130 million on the position with Biden at the helm.
Want to hear something ironic, though? Oil prices are rallying with Biden in office, despite his efforts to push clean energy. The Invesco WilderHill Clean Energy ETF (PBW), which invests in wind, solar and hydropower firms, is down a crushing 28.4% during Biden’s first 100 days.
Not Your Usual S&P 500 Technology Rally
What’s missing from the giant winners under Biden? Many of the giant technology and communications services firms.
Some of the key FANG stocks, namely Apple (AAPL) and Netflix (NFLX), are lagging this year. Apple is up just 4.9% this year and Netflix 0.8%. The MicroSector FANG+ fund (FNGS), which owns the FANG stocks and others with similar characteristics, is up just 8.2%.
With that said, several FANG stocks are generating massive amounts of wealth under Biden.
IBD Leaderboard member Alphabet‘s (GOOGL) shares are up more than 34% in the past 100 days. That put nearly $400 billion into investors’ pockets, more than any other S&P 500 company. Vanguard holds more Alphabet stock than anyone, 6.6%. Facebook (FB), too, was a hated stock in 2020 during the election. But this year, shares are up 26%, minting $192 billion in new wealth. That’s a $24.4 billion windfall for CEO Mark Zuckerberg, who owns 12.6% of outstanding shares. Should you buy Alphabet or Facebook stock, now?
Meanwhile, some less obvious plays are perking up. Computer storage firm Seagate is up 58.2% since Biden took office. That’s the largest percentage gain of any stock in the S&P 500.
What’s Coming In The Next 100 Days?
The past 100 days is just ancient history, right? What about the next 100 days?
The next 100 days are less certain and bullish. In the 100 days following a new president’s first 100 days, the S&P 500 posted an average annual gain of just 2.1%, Stovall says. That’s good. But it rose only 54% of the time in the second 100 days.
There doesn’t seem to be any predictive signal from a president’s first 100 days about the rest of the term, says Ryan Detrick, strategist at LPL Financial. For instance, stocks struggled during President Eisenhower’s first 100 days. But a big rally followed in the rest of his term. On the other hand, stocks rallied in President Taft’s first 100 days. But struggled during the rest of his term.
“In the end, fundamentals, valuations, and technicals drive long-term equity returns,” Detrick said. Perhaps, though, putting aside politics is what the S&P 500 needed. “Although maybe everyone might not like President Biden … (but) the stock market doesn’t have many tissues with him.”
Top S&P 1500 stocks during the first 100 days of President Biden’s term (click on symbol for analysis)
|Company||Symbol||Stock 100-day % gain||Sector||Composite Rating|
|Avis Budget Group||(CAR)||133.9%||Industrials||62|
|Designer Brands||(DBI)||95.1%||Consumer Discretionary||57|