With every new president, there comes new ideas that will set the economic tone for the next four years. Joe Biden has now settled into the White House, meaning these ideas will be put in motion to fulfill promises and build policy.
COVID-19 is still impacting the economy and unemployment levels remain high. The first focus for Biden will be the upcoming stimulus that could approach nearly $2 trillion. While this will be a major tailwind for the economy, there are certain sectors that will benefit more than others due to Biden’s agenda.
This road map has been laid out by the Biden team in the “Build Back Better” recovery plan. More specifically, there are five areas that will reward investors if the new administration can follow through on its promises.
Let’s take a look at what investors are focusing on as we start 2021:
Alternative Energy
The energy sector is going through a fundamental change as consumers and governments around the world shift to more ecofriendly ideas. A movement away from fossil fuels into more climate friendly energy methods is one of Biden’s goals to fight climate change.
Since the Democrats have full control of Congress, it will be easier to turn these ideas and turn them into policy. This move will incentivize money to flow into clean energy projects such as electric vehicles, as well as wind, solar and hydroelectric power.
Biden wants a “Clean Energy Revolution” that will bring the country to carbon-neutral by 2035. This is bad news for oil and gas, but great news for young budding companies in the clean energy industry.
Infrastructure
The upcoming stimulus would involve direct payments, money for unemployment, child tax credits, $15 minimum wage, funds for local governments, and possible student loan forgiveness.
There is wide speculation that the back half of the year could lead to an equally large package that focuses on American infrastructure. If momentum for the “Build Back Better” recovery plan takes hold in Washington, it will be an historic level of investments.
The main areas of focus for such a bill will be manufacturing, R&D and clean energy. The new administration will be committed to infrastructure and won’t be shy at throwing money into big projects. Think roads, bridges and public transport as areas that could benefit. However, 5G and other elements of the “smart economy” will likely get funding as well.
More . . .
------------------------------------------------------------------------------------------------------
Revealed: Zacks’ Post-Inauguration Stock Predictions
The new Biden administration has created a tremendous buying opportunity for savvy investors.
Presidential Profits: 5 Stocks To Ride Under the New Administration features 5 picks that could skyrocket in the months ahead, based on Biden’s policies. Our past “presidential picks” have shot up +71%, +83%, even +185%.¹ Our Biden stocks could be even more impressive.
The Presidential Profits report is only available until midnight Sunday, February 7.
See Stocks Now >>
------------------------------------------------------------------------------------------------------
Cannabis
The momentum for legalization of marijuana is growing rapidly. As of January 2021, recreational use of marijuana is now legal in fifteen states and only fully illegal in Idaho, Wyoming, Kansas, Tennessee, Alabama and South Carolina.
Is it possible that a Biden administration and a fully controlled Democratic congress will look to federally legalize marijuana?
It isn’t one of their first priorities with COVID still an issue, but there is definitely speculation that a federal law could be voted upon in the coming years. Cannabis stocks would surely benefit if the momentum swings that way, but the industry should thrive under Biden even without 100% legalization
Biden’s pick to lead the DNC is a known backer of marijuana legalization, so there shouldn’t be any questions as to where Biden stands on the issue. A more lenient attitude towards the cannabis industry should be enough of a catalyst to bring to sector back in favor with investors.
Healthcare and Biotech
Healthcare and biotech have become less partisan of late, as most agree drug prices are too high. Additionally, the country has gone through the worst health crisis in its history. In a sector with so much uncertainty, one group that will thrive will be the health insurers.
Biden will make a push to get more people covered, but he won’t shake up the system. This would be positive for the health insurers who have already done well under the ACA.
While the vaccine companies have been flying, an under the radar area going forward are those providing commercial health plans. Once COVID has passed, we can expect the economy to bounce back and the labor market to recover, creating a tailwind for this sector.
Commodities
There perhaps has never been a greater case made for commodities than the response by central banks to the pandemic. Earlier in the year, central banks and governments responded with $15 trillion in stimulus, a large percentage of an $88 trillion global economy.
The amplified move by the Fed has created the dollar to weaken and investors now have big expectations for inflation. The weak dollar is a tailwind for raw materials and other commodities like gold as the they become more affordable to foreign investors.
The pent-up demand that is coming once economies get passed COVID will force demand to come back into the commodity markets. This will inevitably force prices up and benefit companies that will have bigger margins as a result. Whether it be metals, agriculture or energy, there will be companies booming from the policy that was put in place to fight the pandemic.
Position Yourself for Profits Now
There are still challenges ahead with COVID, but the economic theme of 2021 and beyond will be all about stimulus. It is an exciting time to be an investor, but outsized returns should only be expected in those industries that will benefit from the changing landscape in the months and years ahead.
I've created a special report to highlighting specific investments you can make to capitalize on the shifting landscape, starting right away. It’s called Presidential Profits: 5 Stocks To Ride Under the New Administration.
In this report, I reveal 5 specific stocks I believe will benefit most from the coming policy changes. Each one is poised for significant gains in the 2021 and beyond.
Just before Election Day, I predicted a handful of trades would spike higher if Biden won. Those recommendations climbed as much as +21.5%, +70.2%, even +74.5% in less than 3 months.¹ The stocks in my new report could climb just as high.
The Presidential Profits report is only available until midnight Sunday, February 7.
Click here to claim your copy of Presidential Profits: 5 Stocks To Ride Under The New Administration >>
Good Investing,
Jeremy Mullin
Stock Strategist
Jeremy Mullin has been a professional trader for more than 15 years with specific expertise in profiting from patterns set by High-Frequency Traders. He is the editor of Zacks Counterstrike.
¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position.
Image: Bigstock
5 Industries to Thrive Under the New Administration
With every new president, there comes new ideas that will set the economic tone for the next four years. Joe Biden has now settled into the White House, meaning these ideas will be put in motion to fulfill promises and build policy.
COVID-19 is still impacting the economy and unemployment levels remain high. The first focus for Biden will be the upcoming stimulus that could approach nearly $2 trillion. While this will be a major tailwind for the economy, there are certain sectors that will benefit more than others due to Biden’s agenda.
This road map has been laid out by the Biden team in the “Build Back Better” recovery plan. More specifically, there are five areas that will reward investors if the new administration can follow through on its promises.
Let’s take a look at what investors are focusing on as we start 2021:
Alternative Energy
The energy sector is going through a fundamental change as consumers and governments around the world shift to more ecofriendly ideas. A movement away from fossil fuels into more climate friendly energy methods is one of Biden’s goals to fight climate change.
Since the Democrats have full control of Congress, it will be easier to turn these ideas and turn them into policy. This move will incentivize money to flow into clean energy projects such as electric vehicles, as well as wind, solar and hydroelectric power.
Biden wants a “Clean Energy Revolution” that will bring the country to carbon-neutral by 2035. This is bad news for oil and gas, but great news for young budding companies in the clean energy industry.
Infrastructure
The upcoming stimulus would involve direct payments, money for unemployment, child tax credits, $15 minimum wage, funds for local governments, and possible student loan forgiveness.
There is wide speculation that the back half of the year could lead to an equally large package that focuses on American infrastructure. If momentum for the “Build Back Better” recovery plan takes hold in Washington, it will be an historic level of investments.
The main areas of focus for such a bill will be manufacturing, R&D and clean energy. The new administration will be committed to infrastructure and won’t be shy at throwing money into big projects. Think roads, bridges and public transport as areas that could benefit. However, 5G and other elements of the “smart economy” will likely get funding as well.
More . . .
------------------------------------------------------------------------------------------------------
Revealed: Zacks’ Post-Inauguration Stock Predictions
The new Biden administration has created a tremendous buying opportunity for savvy investors.
Presidential Profits: 5 Stocks To Ride Under the New Administration features 5 picks that could skyrocket in the months ahead, based on Biden’s policies. Our past “presidential picks” have shot up +71%, +83%, even +185%.¹ Our Biden stocks could be even more impressive.
The Presidential Profits report is only available until midnight Sunday, February 7.
See Stocks Now >>
------------------------------------------------------------------------------------------------------
Cannabis
The momentum for legalization of marijuana is growing rapidly. As of January 2021, recreational use of marijuana is now legal in fifteen states and only fully illegal in Idaho, Wyoming, Kansas, Tennessee, Alabama and South Carolina.
Is it possible that a Biden administration and a fully controlled Democratic congress will look to federally legalize marijuana?
It isn’t one of their first priorities with COVID still an issue, but there is definitely speculation that a federal law could be voted upon in the coming years. Cannabis stocks would surely benefit if the momentum swings that way, but the industry should thrive under Biden even without 100% legalization
Biden’s pick to lead the DNC is a known backer of marijuana legalization, so there shouldn’t be any questions as to where Biden stands on the issue. A more lenient attitude towards the cannabis industry should be enough of a catalyst to bring to sector back in favor with investors.
Healthcare and Biotech
Healthcare and biotech have become less partisan of late, as most agree drug prices are too high. Additionally, the country has gone through the worst health crisis in its history. In a sector with so much uncertainty, one group that will thrive will be the health insurers.
Biden will make a push to get more people covered, but he won’t shake up the system. This would be positive for the health insurers who have already done well under the ACA.
While the vaccine companies have been flying, an under the radar area going forward are those providing commercial health plans. Once COVID has passed, we can expect the economy to bounce back and the labor market to recover, creating a tailwind for this sector.
Commodities
There perhaps has never been a greater case made for commodities than the response by central banks to the pandemic. Earlier in the year, central banks and governments responded with $15 trillion in stimulus, a large percentage of an $88 trillion global economy.
The amplified move by the Fed has created the dollar to weaken and investors now have big expectations for inflation. The weak dollar is a tailwind for raw materials and other commodities like gold as the they become more affordable to foreign investors.
The pent-up demand that is coming once economies get passed COVID will force demand to come back into the commodity markets. This will inevitably force prices up and benefit companies that will have bigger margins as a result. Whether it be metals, agriculture or energy, there will be companies booming from the policy that was put in place to fight the pandemic.
Position Yourself for Profits Now
There are still challenges ahead with COVID, but the economic theme of 2021 and beyond will be all about stimulus. It is an exciting time to be an investor, but outsized returns should only be expected in those industries that will benefit from the changing landscape in the months and years ahead.
I've created a special report to highlighting specific investments you can make to capitalize on the shifting landscape, starting right away. It’s called Presidential Profits: 5 Stocks To Ride Under the New Administration.
In this report, I reveal 5 specific stocks I believe will benefit most from the coming policy changes. Each one is poised for significant gains in the 2021 and beyond.
Just before Election Day, I predicted a handful of trades would spike higher if Biden won. Those recommendations climbed as much as +21.5%, +70.2%, even +74.5% in less than 3 months.¹ The stocks in my new report could climb just as high.
The Presidential Profits report is only available until midnight Sunday, February 7.
Click here to claim your copy of Presidential Profits: 5 Stocks To Ride Under The New Administration >>
Good Investing,
Jeremy Mullin
Stock Strategist
Jeremy Mullin has been a professional trader for more than 15 years with specific expertise in profiting from patterns set by High-Frequency Traders. He is the editor of Zacks Counterstrike.
¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position.