US election results: Information technology stocks such as Infosys Ltd, Wipro Ltd and HCL Technologies Ltd (HCL Tech) will be in focus, as will stocks of domestic pharmaceutical companies, as early trends suggest Republican candidate Donald Trump was ahead in three states, while Democratic candidate Kamala Harris was ahead in one state.

Analysts noted that Donald Trump, through Executive Order EO13788 “Buy American and Hire American,” increased restrictions on H-1B visas during his first term. H-1B/L-1 visa denial rates increased significantly during Trump’s term and the impact on domestic IT services players was amplified due to their greater reliance on these visas to the era.

Currently, three bills related to employment-based immigration are introduced in the U.S. Congress. These bills aim to protect America’s workforce, while prioritizing highly skilled workers for employment-based immigration and improving the overall process. These bills could, at worst, increase compliance requirements for IT services, JM Financial said, adding that the US presidential election could, however, have limited influence on the passage of these bills.

The national brokerage firm estimated that 65 percent of Infosys’ U.S. employees held H-1B/L-1 visas in fiscal 2017. That figure fell below 50 percent during the ‘FY20 and is likely to have followed a downward trend. Similarly, Wipro said 69 percent of the global workforce was localized in FY20. “This to a large extent protects players from any rise in denial rates, should Trump return to power ” he said.

Pharmaceutical stocks such as Sun Pharma, Cipla and Dr Reddy’s Labs would also be in focus. Both the Republican and Democratic parties intend to reduce prescription drug costs. The Republican Party intends to increase competition in the generics sector (which is negative for US generic pharmaceutical companies); expand the beneficiaries of the Medicare program (positive because this contributes to increasing the volumes of generics). Democratic, on the other hand. aim for faster approval for the first generic drugs. This would be positive for US generic pharmaceutical companies.

“Sectors heavily exposed to US policies, namely IT services, pharmaceuticals and textiles sectors, may need a reorientation due to changes in trade policies and health care reforms. But bonhomie and personal chemistry between Indian PM and US President could go a long way in easing tensions The IT, pharmaceuticals and textile sectors, which export a lot to the US, could. If Donald Trump returns home, India’s domestic growth could be boosted because of Trump’s focus on keeping oil prices low and stable, said Manoranjan Sharma, chief economist -. Infomerics ratings.

Antique Stock Broking said in a recent note that the Trump administration may be a supporter of traditional oil and gas, meaning more exploration and drilling and reducing the benefits of green energy by compared to Kamala Harris’ focus on climate and emissions. Under Trump, falling oil and gas prices would be negative for upstream and positive for OMCs like HPCL, BPCL and IOC and city gas distributors like IGL, MGL and Gujarat Gas.

The brokerage said Donald Trump’s goal of making the United States a global manufacturing superpower would benefit multinational industrial companies like ABB, Siemens, Cummins, Honeywell, GE T&D, Hitachi Energy, which are in the process of become important partners in the value chain of their parent companies with a dominant presence in the United States, Antique Stock Broking said.

“Under the Trump administration, resolution of global conflicts may lead to supply chain flexibility for defense companies such as Bharat Dynamics and HAL. Additionally, the focus on ensuring that the U.S. military is the strongest and best equipped in the world will likely be a problem. positive for the defense ecosystem in India,” he said.

JM Financial noted that a Trump victory and increased tariffs on Chinese imports would mean that China+1 de-risking could accelerate and could benefit Indian auto ancillary companies in terms of higher exports. However, Trump’s protectionist policies may force Indian companies to invest in the US to locate supplies, which were otherwise exported from India, JM Financial said.

Raising tariffs on Chinese imports under Trump could also lead to greater competitiveness for Indian chemical exporters. So, despite the imposition of 10-20 percent tariffs on Indian imports, India’s chemical exports could witness a significant increase.

In the case of metals, the outcome of the US elections is expected to be largely neutral, as higher tariffs are already imposed on Chinese imports of steel and aluminum and no new policies are likely to be announced by either party.