The seemingly radical deregulation by the federal government and bi-lateral deal-making by President Donald Trump has had an unmistakable effect of the stock market. The Dow Jones and other economic measures have set growth records and hit new all-time highs since the November election. It’s important for investors to understand the likelihood of improvement in sectors that relate to evolving policies. Here are several industries and companies that could be trending upward as a result of the recent changes.
Military Equipment Looks Mighty
Getting into companies that build military equipment and technology is a no-brainer. President Trump has touted massive U.S. defense spending, increased border security and brokered a record military equipment deal with Saudi Arabia that will have companies such as Boeing, Lockheed Martin and Raytheon busy for the next decade. But flying under the public’s radar are outfits that supply these leaders. Here are a few to watch closely.
- Curtiss-Wright Corp: This North Carolina outfit has slipped down from being the nation’s top aircraft maker. However, it now makes specialty items for planes and will likely get a nice bump.
- Northrop Grumman Corp: Some circles expect double-digit growth from this Virginia military technology company. It has posted an average 11-percent gain in the last four quarters.
- Rockwell Collins: Although the Iowa outfit is considered an industry leader in aviation tech, its average earning hover at a meager 2.45 percent. Expectations are much higher with a robust military sector at hand.
American Sugar Looks Sweet
The recent resolution over Mexican sugar imports into the U.S. appears to have staved off hostile tariffs and avoided tanking NAFTA talks between the two countries. While American sugar lobbies wanted Mexican sugar imports limited to 15 percent, a deal has been struck at 30 percent. That’s a far cry from the previous 53 percent and should bode well for the profits of companies such as Domino, that grows sugar cane in Florida and Louisiana. On the downside, major sugar drink companies will take a small hit from this move. They tend to buy cheaper imports and several bucked the U.S.-Mexico agreement.
The downward spiral of retail outlets may open Americans to higher paying gigs in the transportation industry. With the rise of online sales, products come to you instead of you trekking to outlets. That means you should keep an eye on deliver companies such as UPS. There’s likely to be steady growth with stock spikes around gift-giving holidays.
The $700 billion trucking industry is on the upswing as container ships keep pulling into U.S. ports. If things like American manufacturing, logging and coal mining get rolling, this sector is likely to explode. Some of the mainstays worth looking at include:
- Knight Transportation
- Old Dominion
- J.B. Hunt Transportation Services
Industries to Put on Hold
There are a few industries that may be worth keeping an eye on, but don’t pull the trigger just yet. The airlines are in a free-fall filled with scandal. On the other hand, the potential revamping of air traffic controllers could help the sector spread it wings.
You may be asking, “where’s the beef” after the deal to ship U.S. meat to China in return for allowing chicken product imports. American cattle ranchers aren’t the biggest exporters, but this may give them a bump. Keep watch, but don’t expect anything groundbreaking.
As the Trump Administration cuts regulations and negotiates trade deals, the smart money may be with the companies that reap immediate and long-term benefits.