Which stocks will rise after the passage of Trump's bill?
The US Congress recently approved the so-called "One Big, Beautiful Bill Act" – a sweeping law that makes permanent Trump's 2017 tax cuts.
The new law also significantly increases government spending on defense and border security, while cutting social spending and green energy subsidies
Financing is provided through the growth of the federal budget deficit and expected revenues from increased import tariffs.
It's clear that such a global shift will impact the US economy and trigger movements in the stock market. So, a logical question arises: which stocks and sectors will benefit most from the new conditions?
Which stocks will rise thanks to Trump's law?
Defense companies : Increased spending—over $150 billion on defense—is an automatic driver for industry giants. For example, Lockheed Martin (LMT)—Motley Fool analysts note that the budget growth makes the company's shares attractive, despite past delays in the F-35 program.
Construction Companies : The construction and materials manufacturing industry will benefit from border and defense programs, as increased spending stimulates demand for steel, cement, and equipment.
Oil and coal sectors : The removal of tax barriers and the phasing out of "green" incentives is increasing the attractiveness of hydrocarbons. For example, following the approval of the law, energy and coal companies showed significant growth on the stock exchange.
Financial Sector and Small Business : Extending tax breaks, reducing the rate, and tightening regulation of social programs are beneficial for banks, insurance companies, and financial institutions. This move will also have a positive impact on small businesses taking advantage of new tax deductions.
If we talk about specific examples, the shares of the following companies may rise in price: Lockheed Martin (LMT), Caterpillar, Vulcan Materials, Wells Fargo, Capital One
Based on the above, the following table can be compiled, which will show the prospects for the US stock market:
| Sector | Growth potential | Examples of shares/instruments |
|---|---|---|
| Defense industry | High ↑ | Lockheed Martin, Northrop Grumman |
| Energy / Oil / Coal | Medium-high ↑ | ExxonMobil, Chevron, Peabody Energy |
| Construction / Materials | Average ↑ | Caterpillar, Vulcan Materials |
| Finance / Banks | Average ↑ | Wells Fargo, Capital One |
| Technologies / Green Energy | Risk of decline ↓ | Tesla, First Solar |
Increased fiscal stimulus is creating short-term growth, especially in traditional industries, but longer-term risks (inflation and high rates) could limit the tech sector and growth assets.
Therefore, it is not yet worth counting on long-term growth of the American stock market in the long term.
