By Illinois Radio Network
SPRINGFIELD – While stock markets were back and forth in the hours after Republican Donald Trump seized the presidency, Caterpillar and John Deere saw gains based on Trump’s commitment to new infrastructure growth.
Overnight trading plummeted and then leveled out as markets closed the next day. But in the middle of all the chaos was President-elect Donald Trump’s known commitment to boosting the government’s domestic infrastructure spending. On the campaign trail, Trump said he would offer $137 billion in tax incentives to private companies that would commit to infrastructure upgrades. This sent Caterpillar’s stock up nearly 10 percent Wednesday morning to a level the Peoria-based company had not seen since 2014. Deere also ended the day with gains as well.
“Infrastructure spending is something that Trump can get done, both from a political perspective and his personal know-how from his time in real estate and building,” said The Steady Trader’s head trader and strategist Serge Berger. He adds that a boom in local builds is a logical benefit for the two machinery companies. “If they’re gonna start pushing this through, they’re gonna need material, they’re gonna need machinery to get this all done. That…should be good for Caterpillar and Deer.”
A spokesman for Caterpillar said in a statement “Both ends of the political spectrum recognize that bridges will have to be built. We look forward to working with President-elect Trump and the new Congress. Our policy priorities have not changed. We will continue to urge swift action on a pro-economic growth agenda. There is bountiful evidence that free trade, tax reform, infrastructure investment and smart regulation are critically important to manufacturers’ success.”
Trump specifically referenced the role Cat earth movers would have in building a wall at the Mexican border.
“The Great Wall of China, built 2,000 years ago is 13,000 miles, folks. And they didn’t have Caterpillar tractors, cause I only want to use Caterpillar, if you want to know the truth. Or John Deere, buy a lot of equipment from John Deere. I love John Deere, too,” he said during a press conference in February.
