BofA’s Hartnett Says Trump Trade to Shield US Stocks From Plunge

Donald Trump’s return to the White House will likely protect US stocks from a big selloff, according to Bank of America Corp. strategists, as investors focus on his protectionist agenda and proposals for lower corporate taxes.

Trump is set to be sworn in as the 47th US president on Monday, and has reiterated his focus on core priorities such as raising tariffs, cutting taxes and cracking down on undocumented migrants.

US stocks are “protected by Trump” from downside, strategist Michael Hartnett wrote in a note, although he doesn’t expect sharp gains either due to risks including high concentration in mega-cap technology stocks, valuations and investor positioning.

The S&P 500 initially rallied following Trump’s election win in November, with domestically focused small-cap stocks outperforming, on bets that his proposals would boost corporate earnings at a time when economic growth remains resilient.

S&P 500