The U.S. election is getting ugly – and investors are getting nervous

Author: , Post Date: July 31, 2020
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The U.S. election is getting ugly – and investors are getting nervous

July 31, 2020 – By David Randall and April Joyner

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Excerpt:

NEW YORK (Reuters) – Investors are increasingly preparing for the risk of a contested U.S. presidential election come the fall, worried that an ugly political situation will create volatility across markets.

A key risk is that Republican President Donald Trump is already questioning the legitimacy of the election, analysts said. His Democratic challenger, former Vice President Joe Biden, currently has a 9 percentage point advantage among likely voters and a significant advantage among voters who are undecided, according to a Reuters/Ipsos opinion poll.

“It is going to get ugly,” said Nick Maroutsos, head of global bonds at Janus Henderson Investors. “I would expect a lot of volatility … but it will be very short-lived, you are talking about a two-week span.”

A contested election due to mail-in ballots would likely be more extensive than the hanging chad issue in Florida in 2000, said David Kotok, chief investment officer at Cumberland Advisors, referring to the confusion over voter intention due to a ballot in Florida that led then-Vice President Gore to challenge the election outcome and call for a recount. The U.S. Supreme Court eventually ruled that Florida did not have to do a statewide recount, ensuring the election of then-Texas Governor Bush.

“My guess is that markets would sell off and maybe sharply with that outcome,” Kotok said.

Read the full article here: https://wkzo.com/news/articles/2020/jul/31/the-us-election-is-getting-ugly-and-investors-are-getting-nervous/1045015/


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