Wall Street might be looking for an Election Day rally today as Dow futures rose 178, or 1.91 percent, to 9,510, Standard & Poor’s 500 index futures rose 21.30, or 2.20 percent, to 990.80, while Nasdaq 100 index futures rose 27.50, or 2.05 percent, to 1,369.00 ahead of the opening bell.
The Stock Trader’s Almanac (2009) shows the following impact of presidential elections on the stock market (based on 96 years of historical data):
- Post-election years have been worse for Republicans.
- Mid-term years have been inferior under Democrats.
- November is much better in election years when the incumbent party is ousted.
- Markets fare better under Democrats while the dollar is stronger under Republications.
- The combination of a Democratic president and a Republican Congress has delivered the best market results.
- The first two years of a presidents’ term market performance lags behind the last two.
4-year Presidential Cycle – Historical Gains
Year/ Total Gain/ Average Gain/ Up years vs. Down years
- Post Election year: 67.3% total gain, 1.6% average gain, 19 up years vs. 24 down years
- Mid-term year: 176% total gain, 4.0% average gain, 26 up years vs. 18 down years
- Pre-election year: 464% total gain, 10.5% average gain, 33 up years vs. 11 down years
- Election year: 288.3% total gain, 6.7% average gain, 29 up years vs. 14 down years
I don’t know what today will bring but please head out and VOTE!
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