Post by David Grana, Head of North American Media, Clear Path Analysis
Recent presidential election polls show Hillary Clinton’s lead against Donald Trump increasing as new allegations about Trump’s past have come to light in the media. Ostensibly, the market knows who will be taking the oath in January. What remains to be seen is what becomes of the Congressional elections, now that Trump has waged war with his own party’s dissidents.
Thanks to infighting between Trump and other notable GOP leaders, such as House Speaker Paul Ryan, the Republican Party is essentially fractured. Congressional election victories that were in the bag mere weeks ago now appear to be in question. This sets up a possible surprise outcome for the House and Senate races, which may sway the balance of power in the Democrats’ favor. What this means for investors is that they may need to rebalance their portfolios to reflect a shift in policy focus. Certain industries will undoubtedly be affected.
With three weeks to go before the election it would be no surprise to see the VIX hover close to 20. We’ve already seen many twists and turns in this election and markets may continue to seesaw, as they have in the last couple of weeks.
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