Trump vs Biden, 5 Key Points to Understand for Stock Market Response After the Presidential Election

[Asia Economy Reporter Oh Ju-yeon] In the global stock market, attention is focused on finding beneficiary stocks related to President Donald Trump and Democratic candidate Joe Biden ahead of the U.S. presidential election on November 3. The securities industry advised that understanding the policies is necessary first, as the policies differ as much as the tendencies of the two candidates.

On the 9th, Kiwoom Securities summarized five key points that investors should know for quick response after the election.

First, regarding China regulations, it is seen that both candidates follow a similar path. Under the Trump administration, policies such as strengthening import tariffs on China and imposing sanctions on Chinese companies like Huawei and TikTok have continued, and Biden's policy advisors have also expressed support for the Trump administration's China containment policies.

Regarding the expansion of internet infrastructure, both Trump and Biden are positive. Although their methods differ, both candidates pursue reducing regulations that hinder internet infrastructure expansion and expanding local internet infrastructure to address the 'digital divide' and secure 'U.S. leadership in 5G technology.'

Additionally, both candidates agree that regulations on so-called 'Big Tech' companies like Apple and Alphabet should be strengthened. Trump suspects Big Tech operates in an 'anti-conservative' and 'left-leaning' manner and believes antitrust investigations should be intensified. Similarly, Biden sees the need to strengthen regulations against Big Tech's antitrust behaviors and the spread of misinformation. Biden also believes government intervention is necessary to address job losses caused by technological innovation.

In terms of new industry promotion policies, the candidates' policies diverge. Trump aims to promote the oil industry and the replacement of aging infrastructure, while Biden seeks to foster the renewable energy industry. Biden has announced plans to invest $2 trillion over four years in renewable infrastructure to create over one million jobs in the U.S.

The tax policies also show opposite stances. Trump advocates for tax cuts, whereas Biden insists that corporations should reduce shareholder returns and pay more taxes. Biden plans to raise the top income tax rate for high earners from 37% to 39.6% and increase the corporate tax rate from 21% to 28%.

Kiwoom Securities researcher Lee Won-joo predicted, "If Trump is elected among these two candidates showing such differences, the current policy direction will be maintained, so there will be little change in stock preferences."

However, if Biden is elected, it is judged that earnings estimates for renewable energy-related companies will rise, potentially changing stock preferences. It is also analyzed that Biden's anti-corporate policies may reduce the overall attractiveness of stock assets and cause a concentration of funds in the renewable energy sector.

Meanwhile, if one must invest now, 'telecommunication equipment stocks' were highlighted. The researcher explained, "Both Trump and Biden believe that investment in the telecommunications industry should increase to secure leadership in the 5G industry and to bridge the digital divide within the U.S."

This content was produced with the assistance of AI translation services.