Investors are considering the impact of a potential Kamala Harris administration on corporate profits through tax increases, which could particularly affect consumer staples.
Harris' recent proposal to raise the corporate tax rate to 28% is presented as a measure to ensure billionaires and big corporations pay their fair share.
Frank Kelly notes that Harris may pursue more aggressive consumer-related policies than President Biden, raising concerns among investors regarding market responses.
Higher tax rates might reduce corporate profits, potentially negatively impacting the stock market, as each percentage point change in the tax rate affects S&P 500 earnings.
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