Health Care and Prison Stocks Up, Gun Stocks and Mexican Peso Down As Investors React to Trump’s Election

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Photo: Michael Nagle/Bloomberg via Getty Images

With Donald Trump’s victory beginning to appear imminent late Tuesday night, investors quickly became skittish. The Dow Jones plummeted by more than 800 points, the S&P 500 dropped by 5 percent, and international markets were sent into a tailspin. But then, just before 3 a.m., Trump spoke. His ability to hold off on telling the world to “suck it” allayed the fears of global markets, and by morning they had nearly recovered. This afternoon, the Dow is up triple digits, and the S&P around one percent.

Among the big winners, so far, are health-care and defense stocks, according to CNBC. With Clinton projected to win the presidency, investors shied away from those. Now, with Trump having pledged to immediately repeal Obamacare and boost Pentagon spending, they’re coming back. Another winner is private-prison stocks. In August, the Department of Justice said it would begin phasing out private prisons, something that Trump would likely undo. And that’s not all. Some analysts believe that Trump could provide another boon for private jails if he follows through on his plans with mass deportation, which would stretch the limits of Immigration and Customs Enforcement. That thinking led to big gains for two companies that operate private prisons in the U.S.

A clear loser on global markets was the Mexican peso, which tends to trade inversely with Trump’s political success (not surprising, given his pledge to tear up NAFTA). At one point last night, the currency was down 10 percent. On the stock front after Trump’s election are gun companies. With Hillary Clinton no longer a threat to tip-toe into the homes of gun owners and steal their weapons, two big gun stocks are down double digits this afternoon.