Trump News: Is The Icahn Trump Duo Bad News For Technology Stocks?

trump icahnThe Latest Trump News Stuns All

President-elect Donald Trump has been giving shape to his cabinet for quite some time, and he has managed to surprise many on few occasions. But this recent Trump news is the most stunning of them all.

Trump has appointed billionaire investor Carl Icahn as his adviser on regulatory matters. Icahn has been an open supporter of Trump, and he has been quite confident about the positive impact of Trump’s policies on stock markets.

Carl Icahn was named special adviser to the president-elect on Wednesday. The Icahn Trump duo will be working on overhauling federal regulations. Moreover, Icahn is also playing a significant role in selecting the next chair of the Securities and Exchange Commission (SEC), according to people familiar with the matter. Interested candidates have contacted Icahn, and he is interviewing others at the request of Donald Trump. (Source: “Trump Names Carl Icahn as Adviser on Regulatory Overhaul,” The Wall Street Journal, December 21, 2016).

As the latest member of the Trump Advisory Board, Carl Icahn seems to have his hands full. He has been helping Trump in filling other important positions as well. But what has caused the most concern is the potential for conflicts-of-interest, as Icahn has investments in oil refiner CVR Energy, Inc. (NYSE:CVI) and the insurer American International Group Inc (NYSE:AIG).     

It is clear that the Icahn Trump duo will be focused on loosening business regulations, as they are of the opinion that U.S. corporations have been overregulated. They argue that strict rules are not letting businesses invest more and help in the growth of the economy.

In an interview with The Wall Street Journal, Carl Icahn said, “What Trump is trying to achieve  is to show business in a lot of this country they aren’t going to be ruined by absurd regulation by bureaucrats.”

Carl Icahn’s top stock holdings are in the energy and financials sector, which puts a question mark on how reduced regulations might personally benefit the activist investor. Icahn sold his stake in Apple Inc. (NASDAQ:AAPL) in April this year, over “iPhone” troubles.

The following chart lists Icahn’s major investments.

Carl Icahn Major Stock Investments

Sr No Company Ticker Shares
1 Icahn Enterprises LP IEP 1270,72,847
2 American International Group AIG 456,44,982
3 Cheniere Energy Inc LNG 326,80,490
4 PayPal Holdings Inc PYPL 338,97,153
5 Federal Mogul Hldgs FDML 1385,90,141
6 Herbalife Ltd HLF 196,11,529
7 Freeport-McMoRan Inc FCX 1040,00,000
8 Xerox Group XRX 990,30,026
9 CVR Energy Inc CVI 711,98,718
10 Hertz Global Holdings HTZ 129,38,596

Chart courtesy of Gurufocus.com

In a New York Times interview last month, Donald Trump had mentioned his conversation with Apple CEO Tim Cook, in which Trump talked about giving the company a big tax cut. Not only that, but Apple was promised big cuts to regulations as well. (Source: “Donald Trump’s New York Times Interview: Full Transcript,” The New York Times, November 23, 2016.)

In another major Trump news story, tech industry leaders were invited to Trump Tower last week, where Trump clearly told them that he is on their side. (Source: “Carl Icahn,” Gurufocus, last accessed December 22, 2016.)

On the face of it, the Icahn Trump duo does not appear to be bad news for the technology sector. Technology stocks are likely to get a boost, as the overall sentiment will improve if regulations are loosened.