MarketWatch’s Hulbert: Stock Market’s Reaction Day After Election is Unknowable

Wednesday, 24 Oct 2012 10:28 AM

By Dan Weil

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While speculation is percolating through the stock market as to how investors will react the day after the election, MarketWatch columnist Mark Hulbert says the answer can’t be predicted, regardless of who wins.

He raised the question of whether stocks would rise after a victory by GOP presidential nominee Mitt Romney, but haven’t done so yet because the odds are still against a Romney win even though the odds have increased dramatically.

So Hulbert looked at elections with surprise results. On the day after Harry Truman upset Thomas Dewey, the Dow Jones Industrial Average dropped 3.9 percent, but it had already fallen 2.2 percent in the three months prior to the election.

Editor's Note: Obama Donor Banned This Video But You Can Watch it Here

In 1960, the Dow gained 0.8 percent the day after John Kennedy upset Richard Nixon. The Dow fell 2.7 percent in the three months before the election.

In 2000, when George W. Bush upset Al Gore, the Dow slipped 1.7 percent between Election Day and mid-December, when a Supreme Court ruling guaranteed Bush’s victory. In the three months prior to that election, the Dow rose 1.0 percent.

Bottom line: “No clear pattern emerges from these results,” Hulbert writes.

USA Today lists assets you may want to hold if Romney wins and ones you may want to hold if President Barack Obama wins.

The Romney portfolio includes stocks of banks, defense contractors, oil producers, coal producers and luxury retailers.

The Obama portfolio contains hospital stocks, home builder stocks, infrastructure stocks, alternative energy stocks and municipal bonds.

Editor's Note: Obama Donor Banned This Video But You Can Watch it Here

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