President Donald Trump wasted no time shaping U.S. markets on his first day back in the White House.
A slew of executive orders aimed at maximizing oil production, curbing immigration, and reshaping energy policies sent ripple effects across various sectors. Dubbed "Trump trades," stocks tied to his administration’s priorities showed sharp volatility, with energy companies and nuclear stocks rallying, while electric vehicle (EV) makers and cryptocurrency firms faced declines.
Among the notable moves, shares of oilfield services giant Schlumberger (SLB) rose almost 2%, buoyed by Trump’s declaration of a “national energy emergency” and plans to strip regulations on fossil fuel production. Meanwhile, nuclear energy companies like NuScale Power (NU) surged 10%, bolstered by Trump’s appointment of pro-nuclear Energy Secretary Chris Wright.
Tesla Feels the Heat as EV Policies Shift
Tesla (TSLA), a cornerstone of the EV industry, experienced a 2.8% drop on Tuesday after Trump announced plans to review what he called “unfair subsidies” for electric vehicles. The potential rollback of the $7,500 EV tax credit, introduced under President Obama and expanded by the Biden administration, threatens to disrupt the competitive landscape.
While Tesla CEO Elon Musk downplayed the impact, calling it a “devastation for competitors” but only a slight hit for Tesla, analysts are less certain. JPMorgan (JPM) estimates that removing subsidies could put as much as 40% of Tesla’s profits at risk. The company’s recent financial performance has been strong, with Q3 earnings rising 9% year-over-year, but its ability to maintain margins in a shifting policy environment remains in question.
Tesla’s stock, which gained 70% in the final months of 2024 following Trump’s election win, now faces increased scrutiny as investors weigh the broader implications of reduced incentives and heightened competition in the EV space.
Crypto and Trump Media Stumble
Trump’s first-day policies also impacted the cryptocurrency market, which saw a cooling-off after Bitcoin’s record high of $109,000. Crypto-linked stocks, including Coinbase Global (COIN) and Marathon Digital (MARA), fell as investors noted the absence of any supportive measures for the asset class in Trump’s initial directives.
Meanwhile, shares of Trump Media & Technology Group, parent company of Truth Social, plunged over 11% despite the inauguration fanfare. The decline followed the meteoric rise of the $TRUMP and $MELANIA cryptocurrencies, signaling increased competition for investor attention within Trump-aligned ventures.
Outlook: A New Era of Market Volatility
Trump’s rapid-fire policy actions signal a return to an administration marked by market turbulence. Investors are bracing for more surprises as the White House pushes for deregulation, shifts in energy priorities, and potential tax policy overhauls.
For sectors like EVs and clean energy, the stakes are especially high. Analysts are closely monitoring Tesla’s response to policy changes, including its upcoming Q4 earnings report and guidance on autonomous vehicle rollouts. Meanwhile, energy firms and traditional automakers stand to gain as Trump’s policies favor fossil fuels and ease restrictions on legacy industries.
As markets adapt to the "Trump 2.0" era, volatility appears to be the only certainty.
Considering a $1,000 investment in these companies?
Our team at Stock Investor carefully curated a list of top stocks with the potential for significant returns, suitable for beginners and seasoned investors alike who are eager to learn a trade and unearth the best stocks to buy. Though not featured in this article, these selected stocks could be game-changers in the future.For those seeking dynamic trading experiences, consider joining our Swing Trade Alerts, Option Income Alert, or our Trading Room. Take advantage of our special offer today, starting at just $1 in the first month.
Unlock the secrets of Smart Money
Explore how billionaires and institutions are influencing the market. Follow their every move with DarkOption Flow and stay updated on essential market insights. Begin your journey to informed investing today!
Education
And if you're a fan of Invest opedia, you'll appreciate what we offer at SharperTrades even more. Explore our comprehensive option trading course and technical trading course, where you can learn trading, analyze stocks, delve into chart patterns for stocks, and gain invaluable insights for making the best company investments.
Unlock Your Stock Market Edge with SharperTrades. Dive into powerful trading tools, learn a trade, and receive expert guidance. Stay up-to-date with regular market updates. Learn trading, basics of investing, and how to pick the best stocks to buy. Whether you're a beginner or seasoned investor and trader, we've got you covered. Get started for free, today!