Don’t Bet on Tuesday
“I can report from on the ground in France,” a reader writes, “we’re already in that new lockdown. Started at midnight [Thursday].
“Restaurants, etc. are all closed or open only for takeout or delivery. The kids are still going to school in-person, but the rest of us can only go out for an hour per day, max.
“And we need to fill out a form on an app to turn our name, address, reason for going out and time we went out into a QR code that the police can scan if we’re stopped and questioned about it.
“Supposed to last until Dec. 1, but that depends on how low the daily [COVID] case numbers get.”
Seems rather dystopian to us… or perhaps a little too on the nose historically speaking.
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Your Rundown for Monday, Nov. 2, 2020…
We examined last week the aftereffects of unseated single-term presidents, something that’s happened just three times in the last century.
On Friday, we looked at unemployment statistics when FDR and Reagan occupied the White House. Today, we’ll look at the stock market under those two presidents.
So what might we expect if we have a new occupant in the Oval Office — will stocks go into high gear… or slam into reverse?
According to The Wall Street Journal: “The Dow Jones Industrial Average rallied in Mr. Roosevelt’s first year and fell slightly in Mr. Reagan’s.”
Zooming out, we find: “During [Roosevelt’s] 1933-45 tenure, the Dow gained 194%… In [Reagan’s] two terms, the Dow vaulted 135%.”
But that was then and this is now: the market in 2020 spun out in March, but revved up to all-time highs — particularly the S&P 500 and Nasdaq — on Sept. 3.
It’s important to note then “the market posted big gains during [FDR and Reagan’s] overall tenures, though it is unclear whether the main cause was their policies or the steep declines the market suffered before they took office.”
In other words, the stock market one day before the election is starting from a place of relative strength while the stock market was weak when FDR and Reagan were elected.
“Betting on how an election turns out makes no more sense than other investment fads,” Greg Carlson of Carlson Capital Management said in 2008 ahead of Obama’s election.
“Vote Tuesday,” he said, “but don’t change your portfolio strategy on Wednesday.”
Market Rundown for Monday, Nov. 2, 2020
S&P 500 futures are up 36 points to 3,300.
Oil is down almost 1.5% to $35.26 for a barrel of West Texas crude.
Gold’s up $10.60 per ounce to $1,890.60.
Bitcoin’s down 2.8% to $13,430.00.
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Take care… We’ll catch up Wednesday.
For the Rundown,