|Jeffrey Kleintop – Chief Global Investment Strategist
What the Coming Tax Cuts Mean for the Stock Market
The US isn’t the only country looking to cut corporate taxes. France, Germany, Japan, and the UK are all considering lowering corporate tax rates in the near future. This is good news for stock markets because it should mean a boost to after-tax profits. Looking at the MSCI World Index, a reduction in the corporate statutory tax rate of 1% can lift profits by around 0.5%. The financial, telecom, utilities, and services sectors get the most benefit from tax cuts while healthcare and technology will get the least benefit.