““Chris Krueger, long-time Capitol Hill watcher for Guggenheim Securities, says the people expecting this kind of kumbaya moment are “Pollyannas”. He said: “My reading of the White House is that they already feel pretty good about their legacy, having done what no administration since Harry Truman has done and extended access to healthcare.” These are the facts on the ground, which bode ill for investors, but there is a conundrum: history suggests we are at a point in the political cycle when markets usually do well. After some volatility around the midterms, the stock market has historically settled into a very strong year in the third year of the presidential cycle, according to an analysis by Jeff Hirsch, editor of the Stock Trader’s Almanac. Sweeping in 180 years of data on the Dow Jones Industrial Average and predecessor indices, he calculates the average Year 3 gain to be 10.4 per cent, almost double the next best year, the presidential election year itself.””
