Investing.com -- As the 2024 U.S. presidential election draws near, investors are increasingly focused on how the potential outcomes could shape the economy and financial markets.
However, the potential risks of a Trump presidency should not be overlooked. His aggressive stance on trade, particularly with China, and his immigration policies could create headwinds for labor-intensive industries and companies with significant international exposure. Harris’s focus on social equity and environmental sustainability could lead to a regulatory environment that imposes new burdens on businesses, potentially curbing profit margins and slowing investment in these industries.
Trump’s approach to taxes is likely to build on the foundation laid by his 2018 Tax Cuts and Jobs Act . In contrast, Harris's tax proposals signal a shift towards higher taxes, particularly for corporations and wealthy individuals. When it comes to government spending, both candidates are likely to continue the trend of elevated federal expenditures, but with different priorities that reflect their broader economic philosophies.
Her focus on social equity and environmental sustainability would lead to increased government spending in areas that support low-income households and promote green energy. This confidence could translate into robust consumer spending, supporting sectors like retail, real estate, and discretionary goods.