President-elect Donald Trump’s policies will have a profound influence on Wall Street, including small investors. That’s because a president’s policies can help lift the stock prices of certain types of companies and depress shares of some others. For instance, whether or not you like the Affordable Care Act (also known as Obamacare) as policy, there’s no question that it has helped push up prices of health-care stocks, which have outperformed all other major sectors over the past five years. At the same time, coal stocks have plummeted, largely due to President Barack Obama’s initiatives to reduce greenhouse gas emissions.
Wall Street is urgently trying to figure out which stocks will benefit or suffer under President Donald Trump. Bottom Line Personal asked stock picker and trend spotter Hilary Kramer to analyze how a Trump presidency might affect the market and individual stocks. What she told us…
Parts of Trump’s agenda seem business-friendly, including a proposed cut in the corporate tax rate to 15% from the current 35% and the creation of a low 10% repatriation tax on the foreign profits of US companies to encourage them to invest that money back in the US. At the same time, Trump has created enormous uncertainty among investors. And his “America First” foreign policy, including threatening to impose a big tariff on Chinese imports, could hurt global free trade and alienate important allies.
Likely stock winners…
US Steel (X). An economic trade war with China could boost the fortunes of US basic-materials manufacturers.
CTC Media (CTCM), which runs major Russian TV networks, and Mobil Telesystems (MBT), Russia’s largest wireless phone operator. Trump’s praise of Russian president Vladimir Putin could translate into a thaw in economic sanctions against Russia.
Likely losers:
Archer Daniels Midland (ADM) and Bunge Ltd. (BG). These agribusiness giants could suffer in a US-Chinese trade war because they are leading producers of soybeans, the largest single US export to China.
