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Markets and the 2024 presidential election


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How will the upcoming presidential election affect the economy and financial markets?

Podcast transcript

How will the upcoming presidential election affect the economy and financial markets? Coming up, we will break down the possibilities.


From Thrivent Asset Management, welcome to Advisor’s Market360, a podcast for you, the driven financial advisor.

If you haven’t heard, there’s a U.S. presidential election this November. And while there is no shortage of reporting on the politics and the viability of the candidates, we wanted to take a different tack. Our goal is to look at the presidential election through the lens of the economy and financial markets. What we learned is a little surprising and perhaps even encouraging.

Obviously, it would be unwise to wade into these murky political waters without a seasoned guide. So, of course, we turned to Steve Lowe, Thrivent’s Chief Investment Strategist to lead the way.

The first thing we want to get a read on was the financial market’s reaction to presidential elections from a historical perspective. Here’s Lowe:

(Lowe) “Markets historically rise in election years despite an unknown future for the country until after the election. For example, the S&P 500 Index rose in 18 out of the last 24 presidential election years, falling only in six. Those six included the Great Depression, the early stages of World War II, the Dot Com bust, and the Global Financial Crisis of 2008.”

As financial professionals, we all know that past performance is not necessarily indicative of future results. So, while Lowe’s historical perspective was illuminating, we wanted to hear his thoughts on what might happen this time around...

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As an independent body, the U.S. Federal Reserve, or Fed, does not play a direct role in the election. But its actions do affect the economy—and the electorate’s perception of the economy most definitely does play a role in the election. So, what’s Lowe’s take on actions taken by the Fed?

(Lowe) “We anticipate that U.S. Federal Reserve, or Fed, will take a more cautious approach to changing rates as November 5th approaches. The Fed is committed to getting inflation down to its 2% target, but the progress has been bumpy and uneven, with the latest data showing its favored measure of core inflation remaining sticky. Historically, the Fed has been reluctant to change interest rates close to Election Day, but this presidential election year comes as we are switching from a tightening monetary policy cycle to expectations of easing. It's been more than 50 years since the Fed was initiating changing rates near an election and not just continuing an established rate cycle of cutting or hiking.”

We wanted to know if there are any circumstances where rate changes could happen near Election Day.

(Lowe) “While the Fed does not want to appear political by changing rates close to an election, it would not hesitate to act in a crisis as it did by cutting rates in October of 2008 during the financial crisis. Markets are not expecting the Fed to make the first cut of this cycle until just after the election, although a Fed cut in September remains possible if inflation and the economy slow enough.”

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We have looked at what is likely to transpire in the financial markets before the election. Now we want to turn our attention to what could happen after the election. Here’s Lowe’s thinking:

(Lowe) “Election Day is still five months off. We are keeping an eye on how markets will respond to post-election day. For example, if the current leadership remains with a divided Congress and Joe Biden remaining President, we don't anticipate reaction as markets have already priced in the current status quo. And if Donald Trump were to be elected, there may be optimism about lowering taxes and reducing regulations. However, those policies would need to get through Congress. A unified government with Republicans and Democrats controlling the White House and Congress would open the door to more significant change and possibly stronger reactions from markets.”

While these presumptive presidential candidates are on different ends of the political spectrum, they do share some desires for the economy.

(Lowe) “The two candidates are very polarized across many areas, but there are similarities, too. Both candidates agree, as one would expect, that for the constituents, it's important for the economy to grow, employment to rise and inflation to be stable, and the markets would agree. Neither candidate is a so-called deficit hawk. Deficits have been large under both, and neither have campaigned on the topic of restraining spending and decreasing the U.S. government's budget deficit. The concern for financial markets is that high budget deficits may impact inflation and push up interest rates. While that is priced in by markets, a larger-than-expected deficit could pressure interest rates further.”

Looking at the candidates’ positions on trade, Lowe again sees a surprising amount of common ground:

(Lowe) “When it comes to trade, both candidates have advocated for protectionist trade policies to support American workers and industries. While tariffs may aid local companies, they have the potential to boost inflation, which the Fed is fighting.”

Lowe said that immigration is another headline topic that has the potential to affect markets.

(Lowe) “Immigration is a topic that can go different ways in impacting the markets. Encouraging immigration helps reduce shortages of workers being felt in many industries, which helps to reduce inflationary wage pressures and sustain economic growth. At the same time, there’s a shortage of housing, so a growing population, while good for the economy, can add to housing and rent price pressures.”

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If there’s one thing that we have learned over the past several years, it’s to expect the unexpected. Lowe agrees:

(Lowe) “This election is unique in the tail risk, or the probability that something extreme will happen, is higher than usual. One concern we are watching is the potential for the election to be contested and how it would affect consumer confidence.”

According to Lowe, a contested election could lead to a variety of outcomes:

(Lowe) “We've had two contested elections in recent history, in 2000 and 2020, but markets really didn't react to either one. This time, surveys already have shown consumers are apprehensive about the political environment. We are watching how well flagging consumer confidence holds up, while small business confidence already is very low, and whether these factors dampen the economy.”

(Music transition)

So, what’s the take-away for investors? To put it concisely, stay invested and stay tuned. At Thrivent Asset Management, we’re watching the markets—and the election—closely.


Once again, we would like to thank Steve Lowe for his insights about the upcoming election. What did you think of this episode? Email us at with your feedback or questions for our experts. Want more episodes of Advisors Market360 and other market and investing insights? Visit us at, where you can learn how we can partner with you, the driven financial advisor. Bye for now.


All information and representations herein are as of 6/6/2024, unless otherwise noted.

The views expressed are as of the date given, may change as market or other conditions change, and may differ from views expressed by other Thrivent Asset Management, LLC associates. Actual investment decisions made by Thrivent Asset Management, LLC will not necessarily reflect the views expressed. This information should not be considered investment advice or a recommendation of any particular security, strategy or product. Investment decisions should always be made based on an investor's specific financial needs, objectives, goals, time horizon, and risk tolerance.

The S&P 500® Index is a market-cap weighted index that represents the average performance of a group of 500 large-capitalization stocks.

Any indexes shown are unmanaged and do not reflect the typical costs of investing. Investors cannot invest directly in an index.

Asset management services provided by Thrivent Asset Management, LLC, an SEC-registered investment adviser. Thrivent Asset Management, LLC is a subsidiary of Thrivent, the marketing name for Thrivent Financial for Lutherans.

Steve Lowe, CFA
Chief Investment Strategist