While votes are still being counted, for investors, this election is over. Like we said over the past few months, it doesn’t matter who gets elected; it only matters to get past the election date and ideally for no individual political party to accumulate too much power. A do-nothing Government is a good Government when it comes to stock prices, as it allows us to focus on the real factors that help identify companies that have the potential to create shareholder value.
The bottom line is that despite all the concerns surrounding the election, COVID-19, and the prospects for a second stimulus package, the truth is that the economic recovery continues unabated with strong job creation and rising wages, complimented by falling interest rates and subdued inflation. This is historically very positive for stock prices on a going-forward basis.
In this week’s market update, we will review market performance under unified and split Government and the power of staying invested regardless of which political party wins power. We will also review Friday’s non-farm payrolls report, what it means for the state of the economic recovery, and, most importantly, your money. Lastly, we will wrap everything up with a review of corporate earnings in Q3 and the state of the corporate credit markets, and how those markets have held up through the uncertainty of the past month.
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