Why Stocks Win, Tesla Loses After Trump Bill
On Thursday, the House passed the Big Beautiful Bill ahead of the July 4, 2025, deadline. The substantial tax breaks and spending are two catalysts for stock markets.
The bill offers $4.619 trillion in tax cuts and other provisions. Lower taxes on things like tips that waiters earn and overtime pay would benefit consumers. They will have more disposable income. This helps retail stocks like Lululemon Athletica (LULU), TJX Companies (TJX), and Gap (GAP), whose shares trended lower recently.
The bill offsets costs by cutting benefits in Medicaid. This will save 1.074 trillion. It reduces education and food expenses primarily through the Supplemental Nutrition Assistance (SNAP) Program. This is bad news for healthcare plan firms like Centene (CNC). CNC stock lost 37.82% of its value in the last week. Similarly, Elevance Health (ELV) fell by 6.79% on the week, while UnitedHealth (UNH) shares were steady.
Electric Vehicle Subsidies End September 30
The tax and spending cut bill will see the EV federal tax credits ending. Tesla (TSLA) loses out in the long run. Consumers are less compelled to buy an EV. Similarly, Rivian (RIVN) and Lucid (LCID) would struggle with sales, helped by the $7,500 tax credit that comes to an end. Used EVs previously had up to $4,000 in tax credits.
For now, Tesla stock is fine. Consumers might stop boycotting the brand to buy a Tesla before the September 30 deadline.
