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1996
Sitting president: Bill Clinton
Who won? Incumbent Democratic President Clinton beat Republican nominee U.S. Sen. Bob Dole.
Market performance: The Dow rose 26.01 percent in 1996, from 5,117.12 to 6,448.26.
The state of things: This is the only strong presidential campaign year for stocks in which a sitting president ran for re-election. Clinton was overseeing a national economy that was in its fifth consecutive year of expansion. Inflation, not counting volatile food and energy sectors, increased at the slowest rate in three decades, according to the Labor Department.
In an article titled "The Triumph of the New Economy," BusinessWeek explained why things were so rosy: "Is the market crazy? Hardly. Underlying the equity boom is the emergence of a New Economy, built on the foundation of global markets and the Information Revolution. Starting in the early 1980s and accelerating in the past few years, the U.S. economy has been undergoing a fundamental restructuring … From the internet to direct-broadcast television, new companies are springing up almost overnight to take advantage of cutting-edge technologies."
This new economy eventually led to the dot-com bubble, which burst and sent the economy into recession.
Note: Charles Dow created the DJIA in May 1896, so this list considers presidential election years beginning in 1900.
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1924
Sitting president: Calvin Coolidge
Who won? Incumbent Republican President Coolidge beat Democratic nominee John Davis. Third-party candidates also gained a substantial vote.
Market performance: The Dow rose 26.16 percent in 1924, from 95.52 to 120.51.
The state of things: Coolidge, the vice president under President Warren G. Harding, assumed the presidency after Harding's death in 1923. Despite the Dow's growth, the economy was in recession during the early months of 1924, with the unemployment rate rising to 5.8 percent. "By the summer of 1924, the business slump was over and the economy again began to grow rapidly," according to the Economic History Association. Then, as now, the national debt was the subject of much hand-wringing, with Coolidge lamenting during his 1924 State of the Union speech that the national debt had eclipsed $21 billion, while the annual federal budget was holding steady at about $3.5 billion.
But by the time of Coolidge's inaugural address in March 1925, the economy's path was clear: "No one can contemplate current conditions without finding much that is satisfying and still more that is encouraging. Our own country is leading the world in the general readjustment to the results of the great conflict … Already we have sufficiently rearranged our domestic affairs so that confidence has returned, business has revived, and we appear to be entering an era of prosperity which is gradually reaching into every part of the nation."
Coolidge would continue to applaud the economy throughout his second term, which ended shortly before the Great Depression.
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1904
Sitting president: Theodore Roosevelt
Who won? Incumbent Republican President Roosevelt beat the Democratic nominee, New York Court of Appeals Judge Alton Parker.
Market performance: The Dow rose 41.74 percent in 1904, from 49.11 to 69.61.
The state of things: Roosevelt, the vice president under President William McKinley, assumed the presidency after McKinley's assassination in 1901. The stock market posted no gains (or losses) the first two quarters of 1904, Fundstrat Global Advisors co-founder Tom Lee told CNBC last year. That flat market behavior wouldn't occur again until 2015. Unlike last year, the 1904 markets soon roared to life, posting the third-largest gain ever in a presidential election year. According to CNBC, "By the second half of 1904, a spate of railroad building sent steel, railroad and copper stocks higher, so the economy and the markets somewhat reconnected."
Roosevelt, in his 1904 State of the Union speech, said three things helped catapult the U.S. economy: "The nation continues to enjoy noteworthy prosperity. Such prosperity is, of course, primarily due to the high individual average of our citizenship, taken together with our great natural resources; but an important factor therein is the working of our long-continued governmental policies. The people have emphatically expressed their approval of the principles underlying these policies, and their desire that these principles be kept substantially unchanged, although of course applied in a progressive spirit to meet changing conditions."
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1908
Sitting president: Theodore Roosevelt
Who won? Republican nominee William Howard Taft beat the Democratic nominee, William Jennings Bryan, a former congressman from Nebraska running for a third time.
Market performance: The Dow rose 46.64 percent in 1908, from 58.75 to 86.15.
The state of things: Roosevelt declined to run for re-election, opening the nomination to Taft, Roosevelt's secretary of war. Taft's election came on the heels of the Panic of 1907, a six-week stretch of runs on banks that led to a stock market crash. The Dow ended the year down nearly 38 percent, and, according to the National Bureau of Economic Research, the economy fell into a recession that lasted until June 1908. So, even though the market regained much of what it lost in 1907, the Dow still ended 1908 lower than it had closed two years earlier. The panic and subsequent recession had far-reaching consequences: They led directly to the creation of the Federal Reserve system.
Unlike other presidents coming off years with big stock market growth, Taft, in his inaugural address, did not talk about prosperity, but rather he spoke of continuing the series of trust-busting business reforms started by his predecessor: "It is believed that with the changes to be recommended, American business can be assured of that measure of stability and certainty in respect to those things that may be done and those that are prohibited, which is essential to the life and growth of all business."
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1928
Sitting president: Calvin Coolidge
Who won? Republican nominee Herbert Hoover beat the Democratic nominee, Alfred E. Smith, the governor of New York.
Market performance: The Dow rose 48.22 percent in 1928, from 202.4 to 300.
The state of things: With Coolidge ending his second term in office, the Republican Party picked Hoover, his secretary of commerce, as the nominee. It's fair to say nobody in power saw what was coming, even as the Dow posted its biggest presidential-year gain ever. In his final State of the Union message in December 1928, Coolidge struck an upbeat tone that suggested the years ahead would be fruitful: "In the domestic field, there is tranquility and contentment, harmonious relations between management and wage earner, freedom from industrial strife and the highest record of years of prosperity."
Hoover would offer a similar assessment during his inaugural address. Months later, the economy came crashing down.
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