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07:53 EDT Week in review: How Trump's policies moved stocks - Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Trump and his administration with this weekly recap compiled by The Fly: 1. SHIPPERS AND TRANSPORTATION: Credit Suisse analyst Allison Landry said that on the back of President Trump's tweet late last week, questions have resurfaced as to whether the USPS has been subsidizing Amazon's (AMZN) logistics costs by charging below market rates in the competitive parcel market, and using its monopoly power in First Class mail to cross-subsidize parcel delivery costs. The analyst believes parcel shipping rates will rise over the long-term as she sees the potential for Postal Reform to be addressed by Congress in 2018. Landry also pointed out that it is only a matter of time before the USPS is forced to raise rates in its package business, which would be a clear positive for FedEx (FDX) and UPS (UPS). On Thursday, Citi analyst Christian Wetherbee argued that the Tax Cut and Jobs Act will drive a "meaningful step up" in earnings as well as free cash flow for essentially all names in Transportation. The analyst said he sees U.S. Rails as likely the biggest winners from tax reform. The free cash flow windfall could save UPS's buyback program. Wetherbee upgraded C.H. Robinson Worldwide (CHRW) to Buy and downgraded Schneider National (SNCR) to Neutral. He also raised his price target for Buy-rated FedEx to $304 from $280, Buy-rated CSX (CSX) to $64 from $58 and for Buy-rated UPS to $143 from $128. Separately, on Friday, UBS analyst Thomas Wadewitz upgraded FedEx, Union Pacific (UNP) and Werner (WERN), all to Buy from Neutral, after factoring the Tax Cuts & Jobs Act into his forecasts. The analyst also cited signs that point toward a favorable volume and pricing environment for freight transports in 2018. 2. AIRLINES: Early this week, American Airlines (AAL) and Southwest Airlines (LUV) announced that they will give bonuses to their employees following the passage of the tax overhaul plan President Donald Trump signed into law late last month. The legislation, known as the Tax Cuts and Jobs Act, lowers the corporate tax rate to 21% from 35%. 3. INSTAGRAM: The Trump administration has called on the Iranian government to lift restrictions on Facebook's (FB) Instagram and other social media, according to Associated Press. The restrictions were temporarily imposed during the anti-government protests in the country. 4. AMEX, MORGAN STANLEY: On Wednesday, in a regulatory filing, American Express (AXP) said that based on the company's current understanding of the Tax Cuts and Jobs Act, it estimates significant impacts to its Q4 and 2017 earnings, as well as future periods. "The transition to the new territorial tax system will cause us to incur a deemed repatriation tax on undistributed earnings of certain non-U.S. subsidiaries. In addition, the reduction of the U.S. corporate tax rate will cause us to adjust our U.S. deferred tax assets and liabilities to the lower base rate of 21%. We estimate the overall impacts of the Tax Act will reduce earnings for Q4 of 2017 by approximately $2.4B and thus we expect to report a net loss for Q4 of 2017. Due to the impacts of the Tax Act, we expect full year 2017 earnings per share to be below our $5.80-$5.90 guidance range," the company stated. Then, on Friday, Morgan Stanley (MS) said that it estimates, based on currently available information, that net income for the quarter ending December 31, 2017, will include an aggregate net discrete tax provision of approximately $1.25B, primarily due to the re-measurement of certain net deferred tax assets using the lower enacted corporate tax rate. 5. RESTAURANTS: Wells Fargo argued on Tuesday that Potbelly (PBPB), Del Taco (TACO), El Pollo Loco (LOCO) and Jack in the Box (JACK) could see the largest EPS accretion tailwind from a reduced corporate tax rate, with Restaurant Brands (QSR), Red Robin (RRGB), Noodles & Company (NDLS) and Yum! Brands (YUM) the companies that could see the smallest tailwind. "Week in Review" is The Fly's weekly recap of its recurring series of "Trump Effect" exclusive stories.
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