As per an article published on CNBC, a senior analyst at AB Bernstein noted that "large banks likely would see 2018 earnings per share jump by 12 to 20 percent, while midcaps would see growth of 15 to 25 percent." Compared with the other sectors, the gain from tax reforms for large-cap banks would be in the 4% to 12% range while small-caps would see a boost of 7% to 17%, according to the article published on CNBC. This brings funds like PowerShares KBW Regional Bank Portfolio KBWR in the spotlight. KBWR was up 0.8% on Nov 2 (read: Powell to Lead Fed: Best ETF Strategies).

Most analysts say that big corporates will benefit from these tax cuts. First, a reduction from 35% to 20% and then "more favorable treatment of income earned abroad, which is either not taxed or taxed at an even lower rate than 20 percent" should prove great for large-cap growth ETFs like iShares Russell 1000 Growth ETF IWF. Notably, large-cap stocks have considerable foreign exposure and are thus beneficiaries of such bills. The fund IWF added about 0.1% on Nov 2.

The new plan intends to rule out many prevalent deductions. The GOP-backed Tax Cuts and Jobs Act would cut the mortgage interest tax deduction for new home loans. "Mortgage interest deductions would be limited to new loans of no more than $500,000, down from the current $1 million. Deductions for second homes would no longer be allowed. Property tax deductions would be capped at $10,000," as per a source.

The bill also eyes annulling of medical expense deduction. Under the existing law, individuals who expend more than 10% of their income on medical expenses are permissible to subtract part of those costs from their taxes. But the proposed new bill would eliminate such deductions. Omitting the deduction will help Republicans with about $10 billion. Health Care Select Sector SPDR ETF XLV lost about 0.4% on Nov 2 (read: Healthcare ETFs Head to Head: XLV vs. VHT).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
SPDR-HLTH CR (ETF:XLV): ETF Research Reports
 
SPDR-SP HOMEBLD (ETF:XHB): ETF Research Reports
 
ISHARS-US HO CO (ETF:ITB): ETF Research Reports
 
PWRSH-DYN BLDG (ETF:PKB): ETF Research Reports
 
PWRSH-KBW RBP (ETF:KBWR): ETF Research Reports
 
ISHARS-RS 1K GR (ETF:IWF): ETF Research Reports
 
US-TAX REFORM (TAXR): ETF Research Reports
 
To read this article on Zacks.com click here.
 
Zacks Investment Research
 
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report