The holiday weekend has done nothing to stem the positive momentum in US stocks. Strong US employment data boosted investors on Thursday and futures are higher early Monday, implying a gain of 350 points for the DIA Jones Industrial Average DJIA,
out in the open.
But coronavirus cases continue to rise, with another record daily rise for the United States on Friday, while electoral uncertainty and associated risks also linger on the horizon. Recent national polls show Democratic presidential nominee Joe Biden before President Donald Trump. Analysts and investors have seen some of Biden’s policies as potentially damaging to Wall Street.
In our call of the dayJPMorgan strategists said, contrary to the current consensus, a Biden victory in November would be “neutral to slightly positive” for the stocks. The Democratic candidate’s main economic policies include raising the corporate tax rate from 21% to 28%, partially reversing Trump’s cut, and increasing the federal minimum wage. The investment bank’s US equity strategy team also hoped that the former vice president would reduce tariffs on China and increase spending on infrastructure.
Read: How to Position Your Portfolio for a Joe Biden Presidency
Presidential challengers tend to campaign extremely, converging with the central post-election, JPMorgan strategists said, adding that Biden’s political priorities were initially set before COVID-19 and would surely change.
“Given current economic weakness, business recovery and job growth are likely to be prioritized over policies that could slow economic growth and perhaps even jeopardize the outcome of desired midterm elections by 2022,” The investment bank’s US equity strategy team said in a note. The highest corporate tax rate would generate a profit of around $ 9 for the S&P 500 SPX,
earnings per share, strategists warned, led by Dubravko Lakos-Bujas.
However, they said the increase in corporate taxes could end at a rate of less than 28% and would also be offset by lower rates, infrastructure spending and higher wages. “Also, a more diplomatic approach to domestic / foreign policy is likely to result in less volatility in stocks and risk premiums,” they added.
The best results from the team’s Democratic agenda, while emphasizing that the agenda remains fluid, include Tesla TSLA,
and Nikola NKLA,
both benefit from spending on alternative energy and green technologies. Biden’s healthcare agenda puts Johnson & Johnson JNJ,
CVS CVS,
and others in the top-performing basket, while the rate cut sees Procter & Gamble PG,
Nike NKE,
Boeing BA,
3M MMM,
and DuPont DD,
characteristic.
Increasing the minimum wage would have a positive impact on consumer spending and would be a positive net result for S&P 500 companies despite higher costs and some job loss, JPMorgan said. “Distinguishing between winners and losers will depend on companies that will see incremental demand due to increased disposable income, less labor intensity (income / employees) and higher margins,” they said. As a result, Apple AAPL,
Facebook FB,
GOOG Alphabet,
Twitter TWTR,
and Visa VISA,
they all made the list of the best.
The market
After strong job data sent US stocks higher on Thursday, the Dow would open higher again on the other side of the Independence Day holiday weekend as positive sentiment in Around the economic recovery continued. Dow futures YM00,
1.4% higher, S&P 500 futures ES00,
up 1.1% and Nasdaq NQ00 futures,
They were 1.2% higher before the opening. SXXP European Shares,
emerged early Monday, led by banks and following an overnight rally in Asia – China’s Shanghai Composite SHCOMP,
it was up about 6%.
The buzz
Warks Buffett’s Berkshire Hathaway BRK.B,
BRK.A,
is buying D from Dominion Energy,
Natural gas storage and transmission assets in a deal worth $ 9.7 billion, the company said Sunday night.
Uber carpool UBER,
He agreed to buy the Postmates food delivery service for around $ 2.65 billion, according to media reports Sunday night.
The second largest cinema operator in the world, Cineworld CINE,
said on Monday that Cineplex CGX from Canada,
has initiated legal proceedings against him in connection with the termination last month of a proposed acquisition.
German manufacturing orders rebounded in May, rising 10.4% after their biggest drop in April since records began in 1991.
Big tech companies, including Alphabet, Google’s parent, Amazon and Facebook, are facing a series of proposed EU regulations aimed at curbing alleged anti-competitive behavior, a senior EU official said.
Random readings
The Las Vegas sportsbook suffers one of the biggest losses after the Bellagio Resort & Casino mistake.
Need to Know starts early and updates until the opening bell, but register here to receive it once in your email box. Be sure to check the item you need to know. The email version will ship at approximately 7:30 am EST.
Follow MarketWatch on Twitter, Instagram, Facebook.
.
