Will Midterm Elections Cause the Stock Market to Plunge? 75 Years of History Offer an Unexpected Answer.
Although midterms lead to heightened stock market volatility, year six for two-term presidents has historically been a breadwinner for investors.
Overview
Although Donald Trump's presidency has brought about some of the stock market's wildest vacillations in history, there's no denying that the timeless Dow Jones Industrial Average (DJINDICES:^DJI), broad-based S&P 500 (SNPINDEX:^GSPC), and growth stock-dependent Nasdaq Composite (NASDAQINDEX:^IXIC) have generated outsize returns under Trump.
The Trump bull market has been fueled by the evolution of artificial intelligence (AI), better-than-expected corporate earnings, and record share buybacks powered by the president's Tax Cuts and Jobs Act (TCJA), which permanently lowered the peak marginal corporate income tax rate from 35% to 21%. But history shows that bull markets aren't indefinite, with catalysts always waiting in the wings to trip up the stock market.
Midterm elections are less than eight weeks away. Image source: Official White House Photo by Molly Riley.
Details
Source
Originally published at www.fool.com.