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What the stock market typically does after the U.S. election, according to history

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Traders work on the floor at the New York Stock Exchange on Oct. 24, 2024.

Brendan McDermid | Reuters

Stocks typically rise after a presidential election — but investors need to be prepared for some short-term choppiness first, history shows.

The three major benchmarks on average have seen gains between Election Day and year-end in the presidential election year going back to 1980, according to CNBC data. However, investors shouldn’t be expecting a straight shot up in the market after polls close.

The S&P 500 after the election

Election Date Day After Week After Month Later Year End
11/3/2020 2.20% 5.23% 8.83% 11.48%
11/8/2016 1.11% 1.91% 4.98% 4.64%
11/6/2012 -2.37% -3.77% -1.01% -0.15%
11/4/2008 -5.27% -10.62% -15.96% -10.19%
11/2/2004 1.12% 2.97% 5.29% 7.20%
11/7/2000 -1.58% -3.42% -6.17% -7.79%
11/5/1996 1.46% 2.16% 4.23% 3.72%
11/3/1992 -0.67% -0.31% 2.38% 3.76%
11/8/1988 -0.66% -2.48% 0.52% 0.93%
11/6/1984 -0.73% -2.61% -4.49% -1.86%
11/4/1980 2.12% 1.72% 5.77% 5.21%
Average -0.30% -0.84% 0.40% 1.54%
Median -0.66% -0.31% 2.38% 3.72%

Source: CNBC

In fact, the three indexes have all averaged declines in the session and week following those voting days. Stocks have tended to erase most or all of those losses within a month, CNBC data shows.

This means investors shouldn’t be anticipating an immediate pop on Wednesday or the next few days after.

The Dow after the election

Election Date Day After Week After Month Later Year End
11/3/2020 1.34% 7.06% 9.06% 11.38%
11/8/2016 1.40% 3.22% 6.99% 7.80%
11/6/2012 -2.36% -3.70% -1.30% -1.07%
11/4/2008 -5.05% -9.68% -12.98% -8.82%
11/2/2004 1.01% 3.49% 5.47% 7.45%
11/7/2000 -0.41% -2.48% -3.06% -1.51%
11/5/1996 1.59% 3.04% 5.85% 6.04%
11/3/1992 -0.91% -0.83% 0.74% 1.50%
11/8/1988 -0.43% -2.37% 0.67% 1.93%
11/6/1984 -0.88% -3.02% -5.92% -2.62%
11/4/1980 1.70% 0.73% 3.55% 2.86%
Average -0.27% -0.41% 0.83% 2.27%
Median -0.41% -0.83% 0.74% 1.93%

Source: CNBC

That’s especially true given the chance that the presidential race, which is considered neck-and-neck, may not be called by Wednesday morning. America may also need to wait for close Congressional races to have final counts for determining which party has control of the either house.

The Nasdaq Composite after the election

Election Day Day After Week After Month Later Year End
11/3/2020 3.85% 3.52% 10.90% 15.48%
11/8/2016 1.11% 1.58% 4.31% 3.65%
11/6/2012 -2.48% -4.25% -0.75% 0.25%
11/4/2008 -5.53% -11.19% -18.79% -11.41%
11/2/2004 0.98% 2.95% 8.00% 9.61%
11/7/2000 -5.39% -8.12% -19.41% -27.67%
11/5/1996 1.34% 2.23% 5.78% 5.04%
11/3/1992 0.16% 3.83% 8.56% 11.97%
11/8/1988 -0.29% -1.77% -0.96% 0.67%
11/6/1984 -0.32% -1.08% -4.58% -1.27%
11/4/1980 1.49% 0.97% 6.75% 4.76%
Average -0.46% -1.03% -0.02% 1.01%
Median 0.16% 0.97% 4.31% 3.65%

Source: CNBC

The “election is now center stage as the next catalyst for financial markets,” said Amy Ho, executive director of strategic research at JPMorgan. “We caution that uncertainty could linger on the outcome as the timeline for certifying election results could take days for the presidential race and weeks for the House races.”

This election comes amid a strong year for stocks that’s pushed the broader market to all-time highs. With a gain of about 20%, 2024 has seen the best first 10 months of a presidential election year since 1936, according to Bespoke Investment Group.

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Citadel’s Ken Griffin says Trump’s tariffs could lead to crony capitalism

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Ken Griffin, chief executive officer and founder of Citadel Advisors LLC, speaks during an Economic Club of New York event in New York, US, on Thursday, Nov. 21, 2024.

Yuki Iwamura | Bloomberg | Getty Images

Citadel CEO Ken Griffin issued a warning against the steep tariffs President-elect Donald Trump vowed to implement, saying crony capitalism could be a consequence.

“I am gravely concerned that the rise of tariffs puts us on a slippery slope towards crony capitalism,” the billionaire investor said Thursday at the Economic Club of New York.

The Citadel founder thinks domestic companies could enjoy a short-term benefit of having their competitors taken away. Longer term, however, it does more harm to corporate America and the economy as companies lose competitiveness and productivity.

Crony capitalism is an economic system marked by close, mutually advantageous relationships between business leaders and government officials.

“Those same companies that enjoy that momentary sugar rush of having their competitors removed from the battlefield, soon become complacent, soon take for granted their newfound economic superiority, and frankly, they become less competitive on both the world stage and less competitive at meeting the needs of the American consumer,” Griffin said at the event.

Trump made universal tariffs a core tenet of his economic campaign pitch, floating a 20% levy on all imports from all countries with a specifically harsh 60% rate for Chinese goods.

The protectionist trade policy could make production of goods more expensive and raise consumer prices, just as the world recovers from pandemic-era inflation spikes.

“Now you’re going to find the halls of Washington really filled with the special interest groups and the lobbyists as people look for continued higher and higher tariffs to keep away foreign competition, and to protect inefficient American businesses have failed to meet the needs of the American consumer,” Griffin said.

At the same event, Griffin also said that he’s not focused on taking Citadel Securities public in the foreseeable future. Citadel is a market maker founded by Griffin in 2002.

“We’re focused on building the business, on investing in our future. And we do believe that there are benefits to being private during this period of very, very rapid growth,” he said.

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Stocks making the biggest moves midday: NFLX, GOOGL, NVDA, BJ

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CFPB expands oversight of Apple Pay, other digital payments services

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Rohit Chopra, director of the CFPB, testifies during the Senate Banking, Housing and Urban Affairs Committee hearing titled “The Consumer Financial Protection Bureau’s Semi-Annual Report to Congress,” in the Dirksen Building on Nov. 30, 2023.

Tom Williams | Cq-roll Call, Inc. | Getty Images

The Consumer Financial Protection Bureau on Thursday issued a finalized version of a rule saying it will soon supervise nonbank firms that offer financial services likes payments and wallet apps.

Tech giants and payments firms that handle at least 50 million transactions annually will fall under the review, which is meant to ensure the newer entrants adhere to the laws that banks and credit unions abide by, the CFPB said in a release. That would include popular services from Apple and Google, as well as payment firms like PayPal and Block.  

While the CFPB already had some authority over digital payment companies because of its oversight of electronic fund transfers, the new rule allows it to treat tech companies more like banks. It makes the firms subject to “proactive examinations” to ensure legal compliance, enabling it to demand records and interview employees.

“Digital payments have gone from novelty to necessity and our oversight must reflect this reality,” said CFPB Director Rohit Chopra. “The rule will help to protect consumer privacy, guard against fraud, and prevent illegal account closures.”

A year ago, the CFPB said it wanted to extend its oversight to tech and fintech companies that offer financial services but that have sidestepped more scrutiny by partnering with banks. Americans are increasingly using payment apps as de facto bank accounts, storing cash and making everyday purchases through their mobile phones.

The most popular apps covered by the rule collectively process more than 13 billion consumer payments a year, and have gained “particularly strong adoption” among low- and middle-income users, the CFPB said on Thursday.

“What began as a convenient alternative to cash has evolved into a critical financial tool, processing over a trillion dollars in payments between consumers and their friends, families, and businesses,” the regulator said.

The initial proposal would’ve subjected companies that process at least 5 million transactions annually to some of the same examinations that the CFPB conducts on banks and credit unions. That threshold got raised to 50 million transactions in the final rule, the agency said Thursday.

Payment apps that only work at a particular retailer, like Starbucks, are excluded from the rule.

The new CFPB rule is one of the rare instances where the U.S. banking industry publicly supported the regulator’s actions; banks have long felt that tech firms making inroads in financial services ought to be more scrutinized.

The CFPB said the rule will take effect 30 days after its publication in the Federal Register.

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