Who wins the presidential election and which party overtakes Congress could have some big implications for the market, but the outlook for tech stocks may not be as clear as investors would like. For months, analysts have been weighing the prospect of raising corporate taxes if Vice President Kamala Harris wins the election. They also considered the impact of potential tariffs proposed by former President Donald Trump. “Investors are faced with a choice,” Roger McNamee, founder of Elevation Partners, told CNBC’s “Squawk on the Street” on Monday. “On the one hand, Harris represents a continuation of the economic policies that helped create the The strongest economic growth of any developed country since the pandemic, but it also combines that with tougher antitrust enforcement.” “He has put forward a very different vision than Trump.” .IXIC YTD Tech-heavy Nasdaq performance this year As investors have increased their bets on the artificial intelligence industry, the performance of the Nasdaq has increased in recent months. , shares of big tech companies soared to new heights. However, these gains have come with some hurdles, including a summer sell-off as sentiment about artificial intelligence returns waned. Antitrust and regulatory concerns Investors have been paying close attention to the difficulties faced by technology giants in their development, which has raised antitrust concerns from regulators. In August, for example, a judge ruled that Google has a monopoly in online searches. The Justice Department said in October that a potential breakup of the company could be an antitrust remedy. Some on Wall Street see Harris’ victory as a potential hurdle for antitrust and Big Tech stocks. “Regulatory scrutiny will likely help with the massive M&A activity under Trump – Harris, which will be more of a status quo,” said Jay Woods, chief global strategist at Liberty Capital Markets. “We’ve already worked out a plan with her. “I’m going to revolutionize anything,” McNamee said, adding that increased antitrust scrutiny could “unlock a lot of value for businesses.” Investors are trapped inside these companies. Chip Inventories and Tariffs Wall Street is also focused on the semiconductor industry, a key industry that could be affected by the election outcome. Bank of America analyst Vivek Arya pointed out that under Democratic and Republican presidents, the PHLX Semiconductor Industry Index outperformed the S&P 500 by an average of 51% and 38%. Trump has hinted at possible tariffs on the industry. He also singled out Taiwan, accusing it of stealing the U.S. chip industry in a recent interview with Joe Rogan. Arya said analysts at the SOX YTD mountain semiconductor index so far this year believe this is one of the biggest potential risks to the industry and could hit well-known brands in the PC, server and memory chip markets. These may include companies such as Advanced Micro Devices, Qualcomm, Nvidia and Broadcom. Trump has imposed comprehensive tariffs of up to 20% on imported products and a 60% tariff on imported products from China. “In the case of full tariff installments, we expect IT hardware vendors to absorb some of the increased costs but still significantly increase their product prices (0-60%?), which is a potential for the overall unit Resistance,” Arya writes. The impact on semiconductors under a Harris administration is likely to come in the form of higher corporate tax rates. So far, Trump has hinted at tax cuts for certain companies, while Harry Sri Lanka proposed to increase the tax rate from the current 21% to 28%. If Harris increases the tax rate, low-tax beneficiaries such as Nvidia, Texas Instruments, Intel and Qualcomm will be at risk. If Harris wins, the federal government may. “We will continue to support and incentivize domestic production while maintaining export controls and investment reviews of Chinese companies,” wrote Ed Mills, managing director at Raymond James & Co. and a Washington policy analyst. Stock buybacks Beyond semiconductors, Bank of America’s Brad Sills also pointed out that stock buybacks are likely to be taxed at a higher rate under Harris, which could increase the tax obligations of large buyback companies such as Microsoft, Oracle and Salesforce. The Harris camp proposed raising the tax rate from 1% to 4%. BTC.CM= YTD Bitcoin Year-To-Date Performance Regarding artificial intelligence, Raymond James’ Mills believes a Harris administration could lead to a greater focus on AI safety, ethics and consumer protections. At the same time, he said a Trump victory could ultimately lead to a “potential rollback” of limited oversight and reporting requirements. Wedbush Securities analyst Dan Ives sees Trump’s proposed tariffs and tougher view of China as supply chain impediments. This could “slow the pace of the AI ​​revolution,” he said in a recent article on X, which also called a Harris victory “more optimistic” for the industry. Some investors also believe Tesla could be a winner under the Trump administration, given CEO Musk’s close relationship with the former president. Freedom Capital’s Woods said investors have begun to view it as a proxy for a Trump victory, with shares up 28% in the past three months, and that is likely to continue. Wolfe Research’s Chris Senyek noted that Trump’s supportive stance on cryptocurrencies could drive up prices and benefit companies like Robinhood and Coinbase. Cryptocurrency stocks gained during Tuesday’s trading session.
How Tech Stocks Will Perform Under a Harris or Trump Administration | Real Time Headlines
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