Harris vs Trump Enter Final Stretch: Key Stocks Poised to Impact Wall Street Amid US Election Verdict

The 2024 US presidential race between Vice President Kamala Harris and former President Donald Trump is reaching its climax. As Election Day on November 5, 2024, approaches, the market is closely watching stocks linked to the economic and policy visions of each candidate. This historic election could prompt significant market swings depending on the outcome, with investors speculating on how the new administration might shape various sectors.

Election Polls Tighten Ahead of Election Day

With Election Day just days away, a recent Reuters/Ipsos poll shows Harris’ lead over Trump narrowing to a single percentage point. A majority of analysts predict that a Trump victory could boost equity markets, with some favoring a split government for its potential to curb policy changes. Crypto stocks and small-cap stocks have already seen gains in anticipation of the election, reflecting investor sentiment around potential tax and regulatory changes.

Key Stocks to Watch Based on Election Outcome

Both Harris and Trump bring unique agendas that could shape industries like healthcare, energy, finance, and technology. Let’s explore how each candidate’s policies could affect various sectors on Wall Street.

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Kamala Harris’ Policy-Driven Stocks to Watch

If Harris wins, her policies on housing, healthcare, and renewable energy could significantly impact specific stocks and sectors.

1. Homebuilders

Harris has pledged to increase affordable housing and provide tax incentives for renters and homebuyers. This could benefit homebuilding companies such as:

• D.R. Horton
• KB Home
• Lennar
• PulteGroup
• Zillow Group
• Toll Brothers

With a potential for continued low interest rates, Harris’ housing policies may drive demand for these homebuilders, creating favorable conditions for growth.

2. Healthcare Sector

Healthcare reform is a key focus of Harris’ campaign. She aims to lower prescription drug costs, including capping insulin prices at $35. This cap could put pressure on pharmaceutical companies like:

• Eli Lilly
• Merck
• Pfizer

However, healthcare insurance providers such as Humana and UnitedHealth Group might benefit under expanded coverage policies.

3. Corporate Taxes

Harris supports raising the corporate tax rate to 28%, which could impact high-earning tech giants such as:

• Microsoft
• Apple
• Alphabet

These companies collectively paid $67.73 billion in taxes over the past year, and a higher tax rate may dampen their short-term profits, though it could help offset the federal deficit.

4. Renewable Energy

Harris’ commitment to environmental policies aims to reduce carbon emissions, aligning with the Paris Agreement. Companies in the renewable sector could see strong growth, including:

• NextEra Energy
• Plug Power
• Bloom Energy

Harris’ administration would likely support increased subsidies and incentives for clean energy and hydrogen production, enhancing prospects for firms focused on green energy.

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Donald Trump’s Top Sector Picks

A Trump victory would likely see a shift towards deregulation, lower corporate taxes, and a focus on domestic energy production. Key sectors that could benefit from Trump’s agenda include finance, energy, and crypto.

1. Financial Sector

Trump’s policies might benefit large financial institutions due to potential tax cuts and reduced regulatory burdens. Beneficiaries include:

• JPMorgan Chase
• Bank of America
• Wells Fargo

Trump’s approach to mergers and acquisitions (M&A) and antitrust regulations could also be lenient, potentially benefiting firms such as Goldman Sachs, Morgan Stanley, Lazard, and Evercore.

2. Crypto Stocks

Trump’s administration may adopt a more crypto-friendly stance, possibly appointing a pro-crypto chair for the SEC. Stocks poised to benefit include:

• MicroStrategy
• Riot Platforms
• MARA Holdings
• Hut 8
• Bit Digital

A pro-crypto administration could support the industry’s growth and alleviate regulatory pressures.

3. Energy Sector

Trump favors expanding domestic oil and gas production by reducing regulations. Energy stocks that could benefit from a pro-fossil fuel administration include:

• Chevron
• Exxon Mobil
• ConocoPhillips

In addition, Trump’s stance on LNG export expansion could benefit companies like Baker Hughes and Chart Industries. However, his proposed tariffs on Chinese imports could have mixed effects, especially if China responds with its own tariffs.

4. Trump-Related Businesses

Companies tied to Trump could see gains if he wins, including:

• Trump Media & Technology Group
• Phunware
• Rumble

These firms already saw increased interest in October as Trump’s campaign gained momentum, and a victory could further boost these companies.

5. Prison Operators

A Trump win might also benefit private prison operators Geo Group and CoreCivic, given his stance on stricter immigration policies that could increase demand for detention facilities.

6. Parcel and Logistics Companies

While Trump’s tariffs on China could benefit domestic manufacturers, companies with significant China exposure, like FedEx, UPS, and C.H. Robinson Worldwide, may face challenges due to reduced demand for international shipments.

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Potential Outcomes and Stock Market Impact

While both Harris and Trump have policies that favor specific sectors, many analysts view a divided government as the most favorable scenario for the stock market. A split government could limit rapid policy shifts, providing stability and allowing businesses to plan with less risk of major regulatory changes.

Additionally, small-cap stocks in the Russell 2000 index, which focus on domestic markets, could benefit from either candidate’s agenda if it includes measures that incentivize local businesses and favor the domestic economy.

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Conclusion

The outcome of the 2024 presidential election could create unique opportunities and risks for investors. Harris’ policies are likely to benefit sectors focused on renewable energy, housing, and healthcare, while Trump’s focus on deregulation and domestic production could boost energy, finance, and certain tech stocks. As election day approaches, the volatility in these sectors is expected to increase, providing investors with potential gains or losses based on the eventual winner.

With both candidates pushing forward distinct agendas, Wall Street will continue to speculate on possible changes, adjusting its stance on sectors and stocks as the final vote draws near.