Commentary: Whether it's trump or Harris in the White House, Climate will be key in Investing

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(David Callaway is founder and Editor-in-Chief of Callaway Climate Insights. He is the former president of the World Editors Forum, Editor-in-Chief of USA Today and MarketWatch, and CEO of TheStreet Inc. His climate columns have appeared in USA Today, The Independent, and New Thinking magazine).

With the U.S. stock market soaring to new record highs all year,
investors are suitably concerned about who wins the presidential
election next week to see if the rally can be extended.

Both Vice President Kamala Harris and former president Donald Trump
offer different enticements for investors and both come with
challenges.

READ MORE ABOUT THE PRESIDENTIAL ELECTION AND CLIMATE
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The first thing investors need to remind themselves is that presidents
are often the victims of natural or geopolitical circumstances that
can affect the markets, such as the collapse of Lehman Brothers in
2007 or the European monetary crisis of 2011. Or Covid.

Another thing to remember is that the current bull market just
finished its second year, or 24 months of gains. Average bull markets
run between 24 months and 61 months, or five years.

So based on historical trends, the current bull market will run out
sometime during the next president’s first term. The interest rate
cycle, currently just starting downward after two years of rising
rates, will not likely last for four years, so that is something else
to consider. And Fed President Jerome Powell’s term ends in just two
years, which throws another wrench into the mix.

The impact of global warming is also getting steadily worse, so
President Joe Biden will be the last president who has the luxury of
having to decide whether to deal with it or not. Whoever comes next
won’t have a choice.

But presidential policies can and do play a role in affecting certain
stock sectors, and that’s where investors should focus their attention
as the Nov. 5 election nears. Trump is clearly an energy and defense
play, as well as crypto, while Harris would be a boon for healthcare
and clean-tech stocks. Both will likely bolster the defense industry,
given the state of things in the Middle East.

The distinctions will become even more pronounced over the next few
weeks as the election nears. Already pundits on Wall Street are
talking about the Trump trade vs. Harris trade. In the following two
weeks, we will look at each candidate and what they bring to the
table, what these trades are, and what savvy climate investors can
expect starting Nov. 6.

COMING TOMORROW: A TRUMP PRESIDENCY AND CLIMATE STOCKS