Wall Street Begins Hedging: JPM Says Trump Victory Is “Most Favorable Outcome”, Would Push S&P To 3,900
Mon, 10/26/2020 – 10:33
Over the past month, Wall Street’s strategists have engaged in a comprehensive campaign to “ease” client fears that a Biden administration and/or a “Blue Sweep” would be just as good for stocks if not better than a continuation of the status quo, thus avoiding a selloff should Nov 3 prove to be a rout for Republicans, to wit:
- Higher corporate taxes under Biden? No worries, it will be offset by up to $7 trillion in fiscal stimulus under a joint Democratic congress.
- A doubling of capital gains taxes? No worries, it only will affect the super-rich and while it may hit stocks in late 2021, the dip will be quickly bought as, after all, stocks always go up, with Goldman predicting that “regardless of the election outcome, we expect roughly 10% upside to the S&P 500 by the middle of next year.”
- Higher bond yields under a Democratic sweep? No worries, after all we need higher yields to telegraph that the economy is improving and reflation is returning.
A recent Bank of America analysis laid out the 4 possible election outcomes, which were more dependent on the composition of the Senate than who is president (the worst scenarios for markets were those where “president Biden” faced a Republican Senate and vice versa for Trump):
Join our Telegram channels
- All Headlines: t.me/LiquidaryNewsRoom
- Finance Headlines: t.me/LiquidaryFinance
- Liquidary Insiders: t.me/LiquidaryInsiders
- Crypto Headlines: t.me/LiquidaryCrypto
- Politics Headlines: t.me/LiquidaryPolitics
Join our Telegram group ➡️ t.me/Liquidary
Follow us Twitter ➡️ twitter.com/liquidary
Find the full article here