The Day After...Is the Honeymoon Already Over?

One day after the best election day return in the Dow's history, today's early trading has erased a lot of those gains.  In the table below, we highlight the DJIA's return the day after election day for each presidential election since 1900.  As shown, if the early trading holds up, we are on pace for the worst reaction to an election since Truman won in1948.  Interestingly, the only times the DJIA has ever declined by more than 1% (gray shaded areas) the day after a presidential election were when the Democratic Party won complete control.

The average overall return the day after an election when the Democratic Party is elected to total control is a decline of 0.82% (ten periods).  Conversely, the DJIA has risen by an average of 1.28% the day after the Republican Party wins total control of the Oval Office and both Houses of Congress (eight periods).

   

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