This past week brought more good news for the Democratic Party. Suburban voters in New York state’s 3rd District successfully flipped the Congressional seat previously occupied by expelled former Republican Representative George Santos. Democratic candidate Tom Suozzi enjoyed an impressive almost 8-point victory, defeating GOP challenger Mazi Pilip, receiving just under 54% of the vote. Meanwhile, in Pennsylvania, Democrats maintained their hold on the state’s House of Representatives. School board member Jim Prokopiak enjoyed a significant victory over Republican candidate Candace Cabanas.
This sets a positive tone for the 2024 presidential election as Biden gears up to challenge Donald Trump. For investors, this blue momentum means the classic question: What are the best stocks to buy for a potential Biden victory?
Stocks to Buy for the Next Blue Wave
Even before this week’s special election victories, macroeconomic conditions have been increasingly shifting in Biden’s favor. The S&P 500 has been making notable progress. One week ago, it reached 500 points, marking an important day in financial market history. That’s good news for investors seeking stocks to buy and for sitting presidents seeking reelection. As my colleague Shrey Dua notes, the S&P 500 has correctly determined the winner “87% of the time in the past 22 elections.” In an analysis of why the current stock market predicts a Biden victory, he reported:
“Biden is currently in a pretty good spot. Inflation is down, the labor market is strong and fears of an impending recession continue to dwindle by the day. With interest rates set to ease later in the year, prospects of a “soft landing” — that is, an economic outcome where inflation eases without spiraling the country into a recession — have never been better.”
I’ve already written about the best stocks to buy for a second Biden term. But the truth is there are plenty of companies that stand to benefit if our current president defeats Trump in November. Let’s take a look at a few more stocks that are in an excellent position to benefit.
Clearwater Energy (CWEN)
It’s well established that Democrats favor a clean energy transition. While plenty of firms in the space would benefit from four more years of Biden’s pro-climate agenda, Clearway Energy (NYSE:CWEN) is a great pick for any green boom. It offers investors exposure to many booming clean energy markets, including solar and wind. Muslim Farooque notes that it boasts a “substantial footprint of over 5,500 net megawatts (MW) of wind and solar facilities nationwide and 2,500 net MW of natural gas generation plants.”
That’s enough to continue rising to the top of its sector if the White House continues its trend of funding clean energy infrastructure and development. Additionally, CWEN stock has struggled this month, making it a tempting buy for investors looking to profit as blue wave momentum continues.
Stocks to Buy: Palantir Technologies (PLTR)
We may not associate Democrats with geopolitical turmoil. But there’s no denying that during Biden’s time in office, the defense sector has thrived amid the conflicts between Russia and Ukraine and Israel and Palestine. Neither one is likely to subside anytime soon, though, and one company has a unique edge. Palantir Technologies (NYSE:PLTR) operates in the tech space but has a history of procuring lucrative defense contracts from the U.S. Department of Defense. Thanks to the artificial intelligence (AI) boom, it has enjoyed a year of steady growth but still trades at less than $25 per share.
More recently, the Biden administration announced plans for an executive order to curb “the ability of foreign governments to access sensitive personal data on Americans that could jeopardize national security.” If this focus on data protection continues, Palantir would be in an excellent position to benefit, as its Foundry platform offers data protection and governance services.
Taiwan Semiconductor Manufacturing Company (TSM)
Another point of focus for the Biden administration has been semiconductor production. Part of the historic CHIPS Act included a $5 billion investment in semiconductor research and development. But this focus has included trying to bring leading companies in the space to U.S. soil, such as courting Taiwan Semiconductor Manufacturing (NYSE:TSM). As long as the AI boom continues, TSM will be in an excellent position, as many leading tech companies rely heavily on it.
As InvestorPlace contributor Tyrik Torres notes, “If Biden were to win his reelection, I believe investors should expect more of the same policy incentives to entice contract manufacturing behemoth TSMC to set up factories in the U.S.”
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
