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The Markets After Mid-Terms

Since 1950, the S&P 500 has never been down in the 12 months following a mid-term election.  The average gain in the ensuring year: 15.3%.

This may be because sitting presidents pull out all the stops to boost the economy as they look to re-election. In one famous episode, President Nixon directed the Defense Department to pre-order two years of restroom supplies in an effort to boost the economy ahead of the 1972 election.

The Trump administration likewise will seek to boost the economy in 2019.  One possibility is to forge a deal with Congressional Democrats to boost spending on infrastructure. Beyond that, most of the administration’s economic initiatives are the prerogative of the Executive branch and are largely unaffected by the House changing hands.  This includes trade policy as well as efforts to decrease business regulation.

Elsewhere, the pick-up of Senate seats by Republicans makes it unlikely that the 2017 tax cuts will be rescinded (67 Senate votes would be required to override a presidential veto). 

One wildcard for investors is the outcome of Special Counsel investigations, which according to several media reports, is nearing completion.  

 

DISCLAIMER: Past performance does not predict future results. This report is based on data obtained from sources we believe to be reliable. Hefren-Tillotson does not, nor any other party, guarantee the accuracy or completeness of this report or make any warranties regarding results obtained from its usage. All opinions and estimates included in this report constitute the firms judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation to buy or sell the securities herein mentioned.
Investment Advisory Team
Hefren-Tillotson

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Hefren-Tillotson Inc. is a leading diversified financial services firm providing investment and retirement plan management and comprehensive, financial planning through MASTERPLAN® for individuals and businesses. The firm’s wealth management services are administered by Certified Financial Planner (CFP) professionals, Chartered Financial Analyst (CFA) Charter holders, attorneys, Chartered Life Underwriters, and CPA/PFS’s. Hefren-Tillotson offers corporate services including 401(k) retirement planning, executive financial counseling, fiduciary reviews and workplace financial planning seminars. Founded in 1948, the firm is headquartered in Pittsburgh and has offices located in Pittsburgh, Butler, Greensburg, North Hills, and South Hills.