History says it’s about to be a good two weeks for the stock market
Perhaps the standout tidbit from our piece on how Wall Street was trading the election was this nugget from Bank of America: as goes the day after the election, so go the next two weeks.
“Politics may not matter as much as one would think, but elections can set the near-term narrative. Interestingly, post-election price momentum typically continues into following weeks,” wrote BofA’s equity and quant strategy team in a November 3 note. “The direction of two-week returns following the day after an election was the same as the direction of the day after the election 100% of the time during the prior seven elections (since 1996) and 79% of the time since 1928.”
That makes Wednesday’s 2.5% gain for the S&P 500 on Trump’s election win a portent of good things to come, if history is any guide.
