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'Orderly' Trump win most favorable outcome for equities, JPMorgan says

EconomyOct 26, 2020 10:30AM ET
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© Reuters. United States flags fly outside of the NYSE as markets continue to react to the coronavirus disease (COVID-19) at the NYSE in New York

LONDON (Reuters) - U.S. investment bank JPMorgan (NYSE:JPM) expects the S&P500 index (SPX) to surge to 3,900 points if U.S. President Donald Trump is re-elected next week, calling such an outcome the most favorable for stock markets.

A rise to 3,900 would mark a 12.6% jump from Friday's closing level.

A clean sweep by Democrats would be "mostly neutral" for markets, JPM said in a note received on Monday, adding: "We see an 'orderly' Trump victory as the most favorable outcome for equities."

The odds of a "blue wave" have narrowed slightly since mid-October. Former vice president Joe Biden has a substantial lead in national opinion polls, although the contest is closer in battleground states likely to decide the race.

JPMorgan said several of its data gatherings, such as voter registration, Twitter sentiment, point to a "tightening race". The bank sees a gridlock in the election as a "net positive" for stocks.

Within sectors, JPM sees beaten down energy and financial stocks to likely be key beneficiaries of a Trump victory, while a Biden win could trigger a rotation from U.S. growth stocks to non U.S. growth stocks, given the risk of higher taxes.

"We find that energy, financials and healthcare sectors could likely see the most outsized moves as they have been explicitly referenced by each candidate on the campaign trail," the bank added.

'Orderly' Trump win most favorable outcome for equities, JPMorgan says
 

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Comments (10)
sal galeano
sal galeano Oct 26, 2020 12:16PM ET
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since when have the banks become the everyday man's best friend?
sal galeano
sal galeano Oct 26, 2020 12:15PM ET
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if the banks had it their way we'd all still be living in the 1929 great depression.
taylor jason
taylor jason Oct 26, 2020 12:15PM ET
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your post doesn't make any sense at all
Felipe Daniel
Felipe Daniel Oct 26, 2020 11:47AM ET
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Sleepy Joe
sal galeano
sal galeano Oct 26, 2020 11:02AM ET
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why is Trump good for equities because he'll send a tweet that'll send it skyrocketing only to tweet again sending stocks back down?
Jan Buyle
Jan Buyle Oct 26, 2020 11:02AM ET
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Yes, that is great news for JP Morgan itself.. a lot of transactions is money time for them...
TL Chan
TL Chan Oct 26, 2020 10:47AM ET
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These big banks checked with their legal council that high chance Biden will go to jail soon!
Paul Adelman
Paul Adelman Oct 26, 2020 10:47AM ET
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you are not using that Little portion of your brain called critical thinking there my friend
Jan Buyle
Jan Buyle Oct 26, 2020 10:47AM ET
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What have you been drinkin' man?
Tony Coll
Tony Coll Oct 26, 2020 10:42AM ET
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They're slowing changing the tune in favor of Trump, everyone knows it will be overall better for the economy
SH Parker
SH Parker Oct 26, 2020 10:39AM ET
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If Biden wins it is the best for the stock market ( Chinese stock market)
Jeff Gordon
Jeff Gordon Oct 26, 2020 10:39AM ET
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it matters not which human we prop up as our dear leader and savior. only gods kingdom will solve all problems. say the lord's prayer and keep praying for the kingdom mentioned to come
Kirt Myer
Kirt Myer Oct 26, 2020 10:21AM ET
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it does to all the unborn
Nysom Nysom
Nysom Nysom Oct 26, 2020 10:09AM ET
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does it matter who wins
Not buying
Not buying Oct 26, 2020 10:09AM ET
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2 heads, 1 snake.
 
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