US-focused investment companies were major gainers in the wake of Donald Trump’s election victory, with financials, small-caps and private equity all set to win big as he enters the White House for a second time on promises to raise tariffs and cut taxes.

As the sea of Republican red swept across the country, the main US indices surged to new record highs, with the S&P 500 soaring 2.5% and Dow Jones jumping 3.5%.

Stifel analyst Iain Scouller said that the Republicans’ ‘clean sweep’ in the White House, Senate and Congress would bring ‘further gains in the US stock market’ and deliver a prolonged boost for a handful of trusts.

The winners

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Wednesday’s big risers	Wednesday closing price (p)	Tuesday closing price (p)	Change
JPMorgan Emerging Europe, Middle East & Africa (JEMA)	145	122	18.9%
Jade Road Investments (JADE)	0.22	0.20	10.0%
Schiehallion Fund (MNTN)	88c	82c	8.0%
JPMorgan US Smaller Cos (JUSC )	445	417.50	6.6%
Georgia Capital (CGEO)	1146	1080	6.1%
Baillie Gifford US Growth (USA )	233	220.50	5.7%
Baker Steel Resources (BSRT)	50.50	48	5.2%
Menhaden Resource Efficiency (MHN)	115	109.50	5.0%
ICG Longbow Senior Secured UK Property Debt (LBOW)	20.60	19.65	4.8%
JPMorgan American (JAM )	1056	1008	4.8%
3i Group (III)	3493	3340	4.6%
Brown Advisory US Smaller Companies (BASC )	1427	1365	4.6%
HarbourVest Global Private Equity (HVPE )	2365	2265	4.4%
Manchester & London (MNL)	734	703	4.4%
Artemis Alpha (ATS)	385	370	4.1%

Source: Deutsche Numis, 06/11/24

The Trump administration could have a significant positive impact on the regulation of the financial sector over the next several years with banks, consumer finance, brokers and insurance likely to benefit most, Scouller said.

He highlighted Polar Capital Global Financials (PCFT ), which has half its assets in US financials, as a ‘prime beneficiary’. Shares in the £547m trust rose 3.6% yesterday.

The winners also include US mid and small caps, which will benefit from ‘deregulation and a stronger economy’, including JPMorgan US Smaller Companies (JUSC ), Brown Advisory US Smaller Companies (BASC ), and Global Smaller Companies (GSCT ), which rose 6.6%, 4.6% and 1.7%, respectively.

Private equity funds could benefit if the post-election clarity leads to increased mergers and acquisitions (M&A) activity, trade sales and initial public offerings, while any corporate deregulation would also be helpful. Scouller highlighted trusts with broad exposure to the US, NB Private Equity (NBPE ), HarbourVest Global Private Equity (HVPE ) and Pantheon International (PIN ).

JPMorgan Cazenove analyst Christopher Brown flagged Gore Street Energy Storage (GSF ), which fell 3.5% on Wednesday, as a beneficiary given its battery assets in California and Texas.

Brown said that while the trust was due $60m-$80m of Inflation Reduction Act credits early next year, they were not at ‘big risk’ and ‘more generally if there is less build out of Bess [battery energy storage systems] in the US that would be good for existing assets as there would be less risk of saturation, while potentially lower corporate taxes would also be helpful’.

Brown added that while BH Macro (BHMG ) fell 2.9% on Wednesday, it would benefit from a steeping of the US yield curve, or a widening of spreads between short and long-term government bond yields.

The losers 

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Wednesday’s big fallers	Tuesday’s closing price (p)	Previous Tuesday (p)	Change
Golden Prospect Precious Metals (GPM)	41.00	44.50	-7.9%
Digital 9 Infrastructure (DGI9)	16.00	16.72	-4.3%
Symphony International Holding (SIHL)	0.32	0.34	-4.2%
Urban Logistics Reit (SHED )	111.00	115.40	-3.8%
Gore Street Energy Storage (GSF )	55.40	57.40	-3.5%
Tritax Big Box Reit (BBOX )	134.00	138.50	-3.2%
Care Reit (CRT)	83.50	86.20	-3.1%
BH Macro - £ (BHMG )	371.50	382.50	-2.9%
JPMorgan China Growth & Income (JCGI )	229.50	236.00	-2.8%
Fidelity China Special Situations (FCSS )	213.00	219.00	-2.7%
Triple Point Social Housing Reit (SOHO)	62.50	64.20	-2.6%
Warehouse Reit (WHR)	82.60	84.70	-2.5%
Schroder Real Estate Investment Trust (SREI)	47.50	48.70	-2.5%
Residential Secure Income (RESI)	57.00	58.40	-2.4%
Empiric Student Property (ESP)	89.30	91.40	-2.3%

Source: Deutsche Numis, 06/11/24

For all the sectors that are cheering a Trump victory, there will also be the losers.

The inflationary impact of the planned tariff increases means interest rates will likely stay higher for longer, with Trump’s victory knocking the real estate investment trust sector. Urban Logistics Reit (SHED ) retreated 3.8% and Tritax Big Box Reit (BBOX ) fell 3.2%.

Within investment companies this is set to be in the renewable sector as ‘further rollout of new US renewables projects is likely to face headwinds’, Scouller said.

However, he noted that ‘the current listed US renewables specialist funds have established portfolios and we assume there will be little or no impact to them from any future proposals’.

The China trusts fell on Wednesday over concerns about the increase in tariffs, with JPMorgan China Growth & Income (JCGI ) tumbling 2.8% and Fidelity China Special Situations (FCSS ) falling 2.7%.