Analysts say there has been one other post-election stock rally similar to Trump’s - it was in 1928

Both the Dow and S&P closed at ‘record highs’ on Friday following Trump’s re-election

Some market analysts say the surge in stocks after Donald Trump was elected may not be a positive omen as it resembles the market after Herbert Hoover was elected - shortly before the crash that led to the Great Depression.

Analysts are hailing the market after Trump clinched enough electoral votes on Wednesday morning. Both the S&P 500 and the Dow rose significantly after his victory, both closing at “record highs” on Friday, according to CNN.

“Recent days prove markets’ unambiguous embrace of the Trump 2.0 economic vision. Markets are signaling expectations of higher growth, lower volatility and inflation, and a revitalized economy for all Americans,” Scott Bessent, the founder of hedge fund Key Square Group and a potential pick for Treasury secretary, wrote in a Wall Street Journal op-ed.

“President-elect Trump is the most pro-stock market president we have had in our history,” Jeremy Siegel, finance professor at the Wharton School of the University of Pennsylvania, told CNBC.

But Robert Burgess, a Bloomberg opinion editor, warned in a piece that the post-election stock market might not be a positive sign. He noted that this market is similar to the booming market after Hoover’s election — which came just one year before the 1929 stock market crash.

Anthony Scaramucci, Trump’s former White House communications director, also feared that Trump’s policies — namely mass deportations and tariffs — would result in a stock market crash similar to 1929.

Donald Trump arrives to speak during an election night event at the Palm Beach Convention Center. Analysts warn that the post-election stock market resembles one of 1928 - shortly before the crash that led to the Great Depression (Getty)

“You want to deport 15 million people? You’ll crush the economy; you’ll crush our tax revenues; you’ll flip upside down the job market,” Scaramucci told Business Insider.

“Let me tell you something: If Trump enacted 50 percent of what he’s saying, you’ll have a stock market crash, the likes that you haven’t seen since the 1920s,” he continued. “And by the way, don’t go by me — Elon Musk is saying that.”

Musk, the world’s richest person and a vocal Trump supporter, predicted on his social media platform X just before election day that Trump’s policies could result in Americans experiencing a “temporary hardship” for “long-term prosperity.”

The National Retail Federation has also advised Americans to brace themselves for the impact of tariffs. “It will drive inflation and price increases and will result in job losses,” the trade association’s CEO said last week.

American consumers could lose between $46 billion and $78 billion in spending power each year if the president-elect’s proposals are implemented and prices of everyday items could skyrocket — a $40 toaster would cost between $48 and $52 under these policies — an NRF study found.

However, Burgess remained somewhat hopeful, noting the similarities between Trump’s post-election boom and Hoover’s may not be predictive. He charted the first few days of the market after election day 2024 and election day 1928.

“A primitive overlay chart is no kind of evidence that the stock market is destined for a crash like 1929. The point is that the post-election rally doesn’t prove anything either way,” he wrote.