The inauguration of President-elect Trump is just days away, and the debate continues over what his presidency could mean for investors. Uncertainty looms over the markets, and stocks, which rose sharply right after the election, have bogged down.
Some financial experts say there’s reason for investors to cheer. Here’s why.
“If Trump’s plans to boost the economy work, we would not be surprised to see immediate 3 percent GDP growth, a return to annual 11 percent growth in U.S. equities and the Dow reach 30,000 over the next four years,” says Sam Seiden, market strategist for the Online Trading Academy in Chicago.
Rewards from tax cuts
“If the corporate tax rate goes from 35 percent to 15 percent, it’s a huge boon for U.S. companies. They can return some of that to shareholders,” says Michael Driscoll, a professor at Adelphi University’s business school in Garden City.
Lower tax rates for individuals means more disposable income for that new car or vacation, points out Frank Congemi, a financial adviser in Howard Beach, Queens. Spending boosts the economy. There would also be more to save and invest.
Policies may lead to profits
Savvy investors will follow the trail from policy to profits. Which companies might do well under a Trump administration? “A more business-friendly environment with a ‘light touch’ regulatory philosophy’ ” could open the door for new opportunities for innovative financial technology services companies, says Stephen Newman, a partner with Stroock & Stroock & Lavan in Los Angeles.
Congemi predicts growth for infrastructure companies like Deere and Caterpillar. “Banking, insurance, health care and energy are also poised to do well.”