The US economici calendar is bare today save for a three-year note auction and Fed officials might actually keep quiet today in order to appear impartial so that sets up a wait-and-see trade.
What's everyone waiting to do?
Given that the odds of Republicans taking the House are at least 90% and have been for awhile, I struggle with that line of thinking. Does a larger margin of victory and a win in the Senate materially change that? I doubt it.
What would you do if you were planning to sell stocks for tax-loss reasons? You'd also be waiting for this pop.
Now, I can see the case for buying stocks because I don't think the economy is that bad and I think the Fed will pause around 5% but the timing of that is highly variable. There is a season tailwind from November through April so maybe the timing works around the election.
But without any genuine uncertainty about the result, I can't imagine there's been some flood of money that was held back before buying like in 2020 and 2016.
We'll see. Hopefully there are some opportunities around trading the results as they're released and that's what we will be working on today.
See also:
"A divided congress is good for stocks" is kindergarten-level analysis
The results of the US midterms might not be known for a month
