A Joe Biden win in November would push the markets up, JPMorgan said on a note Monday.
Investors are looking for a quick fix to the presidential election than a challenged outcome. Therefore, a transparent winner will help the market succeed over the threat of related uncertainty and eventually increase, JPMorgan said.
JPMorgan pointed to the 2000 election as evidence that the market would do well in a controversial election scenario.
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Despite Biden’s proposal to increase the corporate tax rate, JPMorgan said he believed Biden would focus on rebuilding the economy and that any tax increases would be “diluted. “
But a shift in market leaders, such as expansion and generation stocks, “could happen” after the November election, JPMorgan said.
Specifically, a rotation between expansion stocks and price actions could be triggered through a more reflationary environment, more forward-looking stimulus, and positive news on the front lines of the virus, the bank said.
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A COVID-19 vaccine would accelerate economic reopening, which would in fact merit valuable movements more similar to the physical economy, but greater merit for price shares would be a more powerful US dollar and higher yields on Treasury bonds, according to JPMorgan. .
While you can imagine a rotation between expansion and price as the year comes to an end, JPMorgan does not propose that investors sell their generation shares.
Technology stocks are subsidized through buybacks and are somehow protected from a weak consumer, and “relative valuations seem unre demanding,” JPMorgan said.
On Monday, Goldman Sachs said the so-called blue wave in November would spur the economic expansion of long-term spending measures targeting infrastructure, physical care, climate and education.
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