If Donald Trump wins next week's election and returns to the Oval Office in January, it will have direct consequences for U.S. business and the economy—and by extension for individual Americans' stock portfolio. This means it's a good time for investors to assess their holdings and to consider what sectors might thrive or suffer under a second Trump administration.
Some plays seem obvious. Trump has traditionally been viewed as positive for banks and fossil fuel companies, but a scourge for sectors like renewables. Several analysts told Fortune, however, that the story might not be quite that simple. From tariffs to tax policy, other potential impacts of a second Trump administration also loom large.
All that said, here are stocks that could rally or plunge if Trump emerges victorious on Nov. 5:
What to Buy
Banks may be the crux of the Trump trade. Jay Hatfield, the CEO of Infrastructure Capital Advisors, isn’t a fan of stock picking based on the presidential race. Nonetheless, he's willing to say financials would benefit from a Trump presidency (regardless of whether Republicans gain control of Congress) due to presumably lighter regulations. JPMorgan Chase, America’s largest bank, could see a boost to its bottom line.
That could also hold true for private equity firms and other asset managers, who have been forced to weather a tough period for deal-making. A company like alternative asset behemoth KKR would stand to benefit from an uptick in both IPOs and M&A.
Crypto is almost certainly set for a friendlier regulatory environment under either Kamala Harris or Trump, at least compared to the status quo under current SEC chair Gary Gensler. The Republican nominee has openly embraced the industry during this election cycle, however, and many crypto bulls are pricing in a Trump victory. Crypto exchange Coinbase and software company MicroStrategy, the largest public corporate holder of Bitcoin, would benefit from a post-election surge.
Finally, energy is broadly seen a Trump play thanks to the former president’s promise to “drill, baby, drill.” Sam Stovall, chief investment strategist for CFRA Research, believes the supply and demand story could be a bit more complicated. Increasing oil production substantially, he said, would reduce the cost of oil.
“That would hurt the upstream companies that are drillers, [as well as] exploration and production companies,” he said, “but it would be helpful to the downstream.” The latter includes refiners like Valero Energy and natural gas transportation giant Kinder Morgan.
See also: 5 Stocks to buy if Harris wins—and 5 to sell
What to Sell
According to this logic, however, prominent drillers like HF Sinclair (famous for its dinosaur logo) and Helmerich and Payne might not benefit from a supposed Trump energy boom.
It’s worth nothing that Hatfield is skeptical of such a story. He also believes the doom and gloom around the future of renewables under Trump is irrational, saying it’s unlikely Republicans will be able to follow through on their calls to repeal or significantly reshape the Inflation Reduction Act, which encourages investments in manufacturing and clean energy.
Regardless, the subject of tariffs is what likely looms largest for retailers. As part of his campaign promises to put “America First,” Trump has proposed at least a 10% tax on all U.S. imports and a minimum 60% tariff on all Chinese goods.
Mainstream economists emphasize that resulting price increases will be passed on to American consumers. That could hit major importers like Walmart and Dollar General hard, Stovall said.
Meanwhile, retaliatory tariffs and trade wars could have a chilling effect on global trade. Cargo and logistics companies like German shipping giant DHL stand to lose.
“If there’s less trade,” Stovall said, then there’s less money to be made.”
Don’t be surprised, then, if a Trump victory causes these stocks to sell-off.
