Joe Biden’s 100th day in office was Thursday, with the S&P 500 up nearly 9% since inauguration day—the best first 100 days of a presidential term since Franklin Roosevelt’s fourth. A president’s effect on stocks is debatable, though easy monetary policy, a vaccine rollout, and strong economic data and corporate earnings can’t hurt. The S&P 500 climbed an average of 3.8% in the first 100 days of 24 presidential terms since 1929, notes Dow Jones Market Data, an annualized rate of 14.5%. The S&P’s average annual rise since inception is 6%.
Early in the year tends to be good for stocks, as companies provide guidance and investors price stocks on higher estimates. The S&P 500 has risen 14 of the 24 first-100 days: nine of 13 Democrats and five of 11 Republicans. Democrats were up an average of 7.3%, Republicans down 0.4%.
The S&P 500’s historical track record for the next 100 days is even better: up 4.8% on average, whether the index rose or fell in the first 100 days.
FDR died in April 1945, before the 100th day of his fourth term. His 10%-plus rise can’t compare with his first term in 1933, when the index soared nearly 80% in 100 days. The reason: the market was rebounding from successive selloffs. The S&P 500’s worst start also came under FDR, in 1941, with World War II ahead, when it lost 10.1% in the first 100 days.
The S&P has recently embraced new presidents. It rose 2.8% and 7.5% in the first 100 days of Barack Obama’s first and second terms, respectively, and 5.3% to start Donald Trump’s presidency.
When Good Is Bad
Bitcoin rallied 11% after losing 18%, opening a week that saw a third of the S&P 500 index reporting first-quarter earnings. Tesla had record profits, up 74% year over year, but the stock fell. The Nasdaq set a new record on Monday, as did the S&P 500 on Thursday, and Big Tech had “blowout”—a suddenly ubiquitous accounting term—results. The Federal Reserve stayed pat, first-quarter growth (annualized) came in at 6.4%, and jobless claims fell. But stocks ended down. Go figure. On the week, the Dow industrials was off 0.5%, to 33,874.85; the S&P 500 was effectively flat at 4181.17; and the Nasdaq Composite fell 0.4%, to 13,962.68.
Biden’s Family Plan
President Biden addressed a socially distant joint session of Congress, just before his 100-day mark, laying out a $1.8 trillion plan for education, child care, paid leave, and tax benefits. He proposed to pay for this by raising taxes on corporations and wealthier Americans, declaring the death of trickle-down economics. He also proposed an $80 billion rebuild of the Internal Revenue Service.
Don’t Say Taper
The Fed’s interest-rate-setting meeting left rates untouched and purchases of bonds and mortgages around $120 billion a month.
Counting Fewer Heads
The Census Bureau put out its first raw numbers and found that the U.S. population grew at the slowest rate since the Great Depression, and that didn’t include the death toll from the pandemic. Population has continued to shift to the South and Mountain West, but less than anticipated. The Financial Times reported that China also experienced a population decline, the first since Mao’s Great Leap Forward, but it held back the data.
On the Covid Front
The Centers for Disease Control and Prevention said that vaccinated Americans can go without masks—outdoors, not in big crowds. India saw a wave of daily Covid infections running over 350,000 a day. The U.S., the European Union, and others responded with medical equipment, protective gear, and vaccines. The Biden administration also offered 60 million doses of the AstraZeneca vaccine, still not approved in the U.S., to countries in need. Johnson & Johnson’s one-dose vaccine returned in the U.S. with new warning labels. Covid-racked Brazil rejected the Russian Sputnik V vaccine.
Annals of Deal Making
The cost of the Archegos selloff hit $10 billion, as UBS and Nomura took more losses…Specialty-chemicals maker W.R. Grace agreed to be acquired by privately held Standard Industries for $7 billion, a 9% premium, but 74% over its March 2020 share price. Grace rejected an earlier bid. The deal includes Grace’s recent buy of Albemarle’s fine chemistry services business…Buyout firm Thoma Bravo bought cybersecurity company Proofpoint for $12.3 billion, a 34% premium… Toyota Motor said it would buy Lyft’s self-driving unit for $550 million…The Wall Street Journal reported that Verizon Communications is shopping its AOL and Yahoo! units.
Write to Nicholas Jasinski at firstname.lastname@example.org