How will the Market/Sectors fare in this Election Week?

Business Money
#1

What seems most certain this week?

  • Gold/silver will rise.
  • Oil/gas stocks will rise.
  • Coal stocks will rise.
  • Alternative energy stocks will rise.
  • Banking/financial stocks will rise.
  • Utilities stocks will rise.
  • Casino/gaming stocks will rise.
  • Consumer staples will rise.
  • Pharma will rise.
  • The market as a whole will rise.
  • The market as a whole will fall.
  • Other, please explain.

0 voters

Seems like, if one were so inclined, an investor with a short-term trader mentality might try to find some way to profit off major world events such as 9/11, the invasion of Iraq, or a US presidential election.

Well, I failed to alter my investing strategy based on the first two. But what about this election? Is it an opportunity to make a quick buck?

People say the market likes certainty so one might think it will rise following the election, regardless of who wins.

But Obama’s 90% likely to win so surely that’s already been factored in and won’t make any difference.

Repubs claim Obama’s bad for business and will cause the markets to decline, but Obama’s favored to win largely because so many voters are confident he’s better for the economy.

Aside from the election, I understand a lot of bad financial reports are scheduled to come out this week, which would cause further losses.

So, what say you? Any sure bets?

#2

Uncertainty would be the worst case, say a protracted legal squabble over vote counting, or some such, but remember it’s only the Repubs that think Obama is bad for business. The moneyed end of town has been very supportive of Obama’s policies. Let’s face it, no one can afford four more years of Repub mismanagement.

Overall, I’d say that the looming news on how bad next year’s going to be, which will be confirmed in upcoming results and forecasts, will outweigh anything else.

HG

#3

[quote=“Mother Theresa”]Seems like, if one were so inclined, an investor with a short-term trader mentality might try to find some way to profit off major world events such as 9/11, the invasion of Iraq, or a US presidential election.

Well, I failed to alter my investing strategy based on the first two. But what about this election? Is it an opportunity to make a quick buck?

People say the market likes certainty so one might think it will rise following the election, regardless of who wins.

But Obama’s 90% likely to win so surely that’s already been factored in and won’t make any difference.

Repubs claim Obama’s bad for business and will cause the markets to decline, but Obama’s favored to win largely because so many voters are confident he’s better for the economy.

Aside from the election, I understand a lot of bad financial reports are scheduled to come out this week, which would cause further losses.

So, what say you? Any sure bets?[/quote]

Kenyan stocks should rise…My witch doctor told me so.

#4

Yea, I’m afraid to make any investments based on the election. I think the certainty of getting it over will be good, the Obama win will be good, but those will be offset by all the bad news coming out, so I’m expecting the market overall to roughly break even.

#5

Down down down. We haven’t seen the bottom of this yet. Don’t see it being quick though. Predict volatile slow decline down into mid-late 2009. Governments the world over are desperately trying to prop things up, which is at best softening the landing, at worst just delaying it. NA stock markets are still over valued versus long term averages. Yes, I know, history versus future, but I haven’t seen any fundamental shift to give reason to think companies should somehow be worth a larger leverage over earnings. Easy credit held it up for awhile, but the fundamentals aren’t there.

#6

Well sure it’s going down in the long-term. Thanks George. I’m just looking at this week.

#7

Is there a way to play on the huge increase in tax shelters?

#8

Huh? Huge increase in tax shelters? I have no idea what you’re talking about. I assume this isn’t a serious reply, but is just a political smear. If it is a serious reply, and OT to the subject of how to profit in the market this week, please explain.

#9

Depends on who wins the election.

I believe an Obama win will boost confidence within the financial markets, while a McCain win will decrease it.

My belief is based on how financial markets performed under Clinton as compared to under Bush Jr. Investors would like a return to Clinton-style prosperity.

#10

It could help a relief rally some have forecast for the remainder of the year, but the mess in the system means only one direction longer term. Good idea not to forget what a poisoned chalice an Obama government will be inheriting, as typically voters do forget that the mess was created by the previous tenant.

HG

#11

Okay call me a dumbass but when Obama is elected he will raise taxes on anyone making over $250,000. So I assume the people who have that much money will be trying to protect it from taxation. I don’t know how but there’s got to be some way, put it annuities, charities, whatever.

#12

Hi Bob. I guessed you would miss the first word in my reply, so I repeated it. Didn’t think you’d miss it 4 times tho :idunno:

FYI, apparently I was wrong so far. Tech and financials up 5-10% this morning.

#13

Damned tootn’. High voter turnout suggests an Obama victory, prompting the biggest election gains on the dollar and stocks in 24 years. Looks to me like these markets like a touch of socialism! :laughing:

Eat that shit, Fukuyama! Herstory aint dead, it’s about to begin!

HG

#14

You’re just being silly HG. Of course Obama’s not a socialist or a marxist or a muslim or a radical (despite the Republicon’s smears). The market simply jumped yesterday because people are thankful 8 years of Republican misrule and devastation are coming to an end, its guaranteed that anyone can do better than the last president, this damn campaign is finally coming to an end and Obama will soon take over. What a relief. But of course it’s just short-term relief, as the fundamental problems are all still there, are immense, and will continue to come to investors’ attention in news this week and in the coming weeks and months, so the temporary relief will soon subside and the market will continue to drop.

As for Fukuyama, we all make mistakes. At least he may be capable of learning from them.

#15

I suppose I can write off Fukuyama’s stupid previous claim on the end of history to youthful exuberance given his latter day conversion to his holiness, Obamamessiah.

HG

#16

[quote=“Huang Guang Chen”]. . . his holiness,
[color=#0000BF]Obamamessiah.[/color]
[/quote]

:angel: :angel: :angel: :angel: :angel: :angel:

:notworthy: :notworthy: :notworthy: :notworthy: :notworthy:

#17

I bet poor old TC never eats toast the same way again. . . “I swear, man, it’s looking at me!” :laughing:

HG

#18

Well, that didn’t last long. Up 3-4% on Nov 4 due to election euphoria. Now back to reality. Down 5% on Nov 5 and sure to continue down.

So, to answer my question: how could a trader profit off the election?

I guess it’s often a good strategy to take advantage of market inefficiencies caused by excessive optimism or excessive pessimism that have nothing to do with the market fundamentals. Or as Buffett stated more pithily, “buy when people are scared, sell when their greedy.”

I guess one could’ve figured that, despite the obviously crappy state of the economy and the obvious fact that we’ll continue sliding down for some time, investors might exhibit a brief moment of irrational exuberance, briefly pushing the market up for just election day, before it slumped back down.

If one wished to capitalize on that one could’ve sold a couple of stocks at the height of election day (the stock of my wife’s US employer surged almost 10% during election day) and then shorted or bought contrarians such as the anti-real estate stock SRS, that Squid mentioned way back, which rose 19% with last night’s post election slump. I’ll deliberate today whether to buy some of that for further market slumpage in coming days/weeks.

Oh well, just trying to learn how to profit from such events in the future.

#19

Way to many variables I’d say. The first thing you want to to consider is whether you’re a day trader or a value investor.

HG

#20

[quote=“Huang Guang Chen”]Way to many variables I’d say. The first thing you want to to consider is whether you’re a day trader or a value investor.

HG[/quote]

Being a day trader is scary as hell in this volatile market. It’s also particularly difficult if one lives in Taiwan and is sleeping during market-time. So, I know it makes more sense not to screw around with such risky, nerve-wracking, game playing, but to go with a sound long-term strategy. . . but, on the other hand, wouldn’t it be nice to swiftly make up for some of the slow, painful loss of the past year through a few slick trades? As I said, SRS rose 19% last night. How much will it rise in coming days?