Breitbart Business Digest: Wall Street’s Midterm Party May Have Started Early

Stocks Skipped the Midterm Blues. Will the Post-Election Rally Be Smaller?

Stocks rose on Tuesday, pushing the S&P 500 to an all-time high. And many investors seem to expect even better days ahead, especially once the midterms are in the review mirror. But those of you counting on next year’s stock market to deliver the usual post-midterm bounty may discover that Wall Street has already helped itself to part of the feast.

It’s easy to see why many investors expect good times ahead. The historical record of the stock market’s performance following midterm elections is impressive. Every midterm election since 1946 has been followed by a positive one-year return for the S&P 500. The average gain was 14.4 percent. With November 3 approaching, that is an inviting number to pencil into expectations for the next twelve months.

The trouble is that the usual weakness preceding those gains has been conspicuously absent. Midterm years generally have been the disappointing stretch of the presidential cycle. BlackRock puts their average annual stock market return at 7.5 percent, against 12.4 percent in other years. Election anxiety has often accompanied a difficult summer, followed by a rally beginning roughly a month before the vote.

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Original source: https://www.breitbart.com/economy/