The Republicans' focus on deregulation and tax cuts aimed at corporations and investors have buoyed the stock market. With a Republican Congress, further regulatory rollbacks on business are possible as are tax cuts.
Republican president with divided Congress
Further tax cuts would be challenging to achieve with a Democratic House. But President Trump’s deregulatory approach would likely continue.
Higher taxes on corporate profits and capital gains, plus policies to discourage share buybacks could be a negative for stocks. But higher taxes don't always mean worse stock market performance—they could be offset by more federal spending stimulating potential earnings growth.
Democratic president with divided Congress
Expect more regulatory scrutiny of certain industries like fossil fuels, health care, financial services, and big tech. Beneficiaries could include renewables and utilities.