During the campaign of Donald Trump, he proposed major policy changes from overhauling the tax code to repealing the Affordable Care Act renegotiating trade deals which could have a very huge impact on consumers and businesses.
During the previous time, there's no major changes between how stock markets perform whether the president is a Democrat or a Republican. Review of the 3,000 largest U.S. stocks by Fidelity Investments found that stock markets gained 12.2 percent on average a year under Democratic presidents, compared with 11.8 percent a year under Republican presidents.
But based on what Trump has said so far, there are certain investments and sectors that could be effected more than others. Here's a look at some of the potential effects investors should be aware of.
Health Care Stock-Health care industry is likely to be disrupted to learn more about Trumps plan for Reforming the Affordable Care Act. He said that under this plan, people will not be required to have insurance which could affect insurance companies.
Financial Firms-- Trump has said that he supports reinstating the Glass-Steagall Act. If he supports policies that call for breaking up big banks, that could be bad news for major financial firms.
Defense Stocks--During the campaign events and debate, Trump had talked about bolstering the military which could be a good cause for defense stock.
Companies That Export Goods-In this concern, Trump will be needing to work with the Congress for him to modify long standing trade deals. In the event that he succeeds in some of the agreement, that could spell losses for companies that export heavily to other countries.
Energy Companies-Donald Trump is in favor of loosening restrictions on the energy industry. Trump is in favor also of reduced regulations on drilling, which could give oil companies such as those on solar energy and other environmentally friendly approaches.
Bonds--Interest rates have been at rock-bottom levels since the start of the Great Recession, and the uncertainty caused by Trump's presidential win could lead to an extension of that low-rate period.Gold--The price of gold also spiked early Wednesday when it became clear that Trump had won the election, but those gains were pared back as stock markets stabilized.
Gold typically gets a boost when stock markets are rocky and investors become more worried about volatility.
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