The S&P 500 (SPX) is between 31. July and October 31 with 0.04%. This means that the prediction of the market – in the breadth of a hair – is that Joe Biden will win, according to the CFRA Research Presidential Predictor.
The scholarship has a fairly reliable track record: After the Second World War, when the S&P 500 fell three months before the November elections, the incumbent president or the incumbent president’s party lost 88% of the elections.
Even if the S&P 500 rises in this period, the former chairman or the party of the former chairman wins 82% of the time.
The stock market predicted a trump card until Friday, when the S&P 500 fell by 1.2%. This was enough to turn the stock into a negative for the last three months and give Biden a razor blade.
This year’s Predictor closed so slightly in the red during this three-month period, implying but not guaranteeing that Biden will win, said Sam Staval, CFRA’s Chief Investment Strategist.
Blue wave insert
President’s Predictor meets Wall Street projections. Goldman Sachs analysts predict a blue wave in which Democrats will once again take over the White House and Senate and retain control of the House of Representatives. Goldman believes this could be a positive result for the markets.
Such a blue wave will probably cause us to adjust our predictions upwards, writes Jan Hacius, chief economist at Goldman Sachs, in last month’s report.
Goldman Sachs (GS) wrote that the blue wave increased the likelihood of a financial stimulus package of at least $2 trillion shortly after the inauguration on the 20th. The month of January will increase dramatically. The company also referred to Biden’s long-term spending plans in the areas of infrastructure, climate, health and education.
Together, these costs would be at least equal to the likely long-term increase in corporation tax and higher income, Goldman Sachs writes.
Similarly, JPMorgan strategists led by Dubravko Lakosh Bujas made a similar remark in July: It is generally agreed that the victory of the Democrats in November will be negative for the shares. However, we consider this result to be neutral and slightly positive.
President Donald Trump has repeatedly predicted that the Democrats would destroy the U.S. economy and that the stock market would collapse if they won in November.
However, Moody’s Analytics found that Biden’s economic proposals, if adopted, would create 7.4 million more jobs than Trump’s. According to Moody’s, the economy will return to full employment in the second half of 2022, almost two years earlier than Trump had predicted.
A management survey by the Yale School of Management at the end of September showed that 77% of the participants would vote for Biden. More than 60% predicted he would win. However, a survey conducted by UBS in mid-October among 500 business owners and 1,000 investors shows that 55% of business owners want to win the trump card, while 51% of investors support Biden.
A CNN poll shows that Biden was murdered on the 28th. October is by far the national leader and with an amazing 270 votes he has to win.
According to RiverFront Investment Group, no outgoing employee has ever won a second term in the two years prior to the election.
The only false prediction made by the CFRA Predictor president when the market collapsed three months before the elections was in 1956, when incumbent president Dwight Eisenhower defeated Adlai Stevenson despite a 7.7% fall in the stock market during the Suez crisis and the Hungarian uprising.
It’s not clear what this could mean for Trump. The market has declined over the last three months, mainly due to an increase in the number of cases of coronavirus. This is largely unpopular in the fight against the pandemic, although some believe that the wave of Covida 19 infections got out of hand. Despite the recession, Trump still has a relatively high appreciation from voters for its economic performance.
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