Posted: 25 Sep 2020 05:57 AM PDT
An interesting aspect of election-year Octobers is the propensity for S&P 500 gains when the incumbent party ultimately retains the White House. Of the ten incumbent victories since 1944, the S&P 500 has advanced seven times, declined twice, and was unchanged in 1944 with an average October gain of 1.4%. Of the nine occurrences since 1944 when the incumbent was defeated, there were six S&P 500 declines and three advances in October. The average October decline when incumbents were defeated was 2.1%. Even excluding the S&P’s 16.9% plunge in 2008, incumbent defeats were still preceded by an average October loss of 0.3%.