November 9, 2016
Republican Donald Trump’s surprising victory in the U.S. presidential election means large American corporations are dealing with a great deal of uncertainty. Corporate leadership is anticipating revamped trade pacts and rules, and a potential crackdown on overseas operations, with the potential of lower corporate tax rates at home.
Though many business leaders weren’t necessarily comfortable with Democrat nominee Hillary Clinton’s policies, they were familiar with them, and were comfortable with the idea of gridlock, according to Brian Gardner with Keefe, Bruyette & Woods.
Trump has been critical of trade agreements such as the North American Free Trade Agreement and the Trans-Pacific Partnership. He has also proposed overhauling corporate taxes by reducing the corporate rate from 35% to 15%. The main issue, however, is that Trump hasn’t suggested specific policy positions, making it difficult to understand if there is a plan in place, said Hal Sirkin with Chicago-based Boston Consulting Group.
While global markets reactive negatively with the election news, the Dow Jones Industrial Average opened with an increase, while the S&P 500 reported a slight decrease.
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