An excellent take from RBC's portfolio advisory group.
Historically, the year after the midterm elections has been the best year for the stock market, regardless of the outcome. The Wall Street Journal notes that the S&P 500 has increased 15% on average in the year after midterms, and has not declined in such a year since 1946. However, RBC Capital Markets U.S. equity strategist Lori Calvasina pointed out that 2018 has not followed the typical path of mid-term election years on a month-to-month basis. Stocks tend to fall from April to September, and then increase for the rest of the year. In 2018, stocks decreased in the beginning of the year, but have been rising since April. Midterm elections will take place on November 6.
Does history repeat itself?
Jeremy