Stock Market Today: The Dow Jones Industrial Average falls and bond yields fall ahead of an election that’s too close to call

The 2024 presidential race so close has many investors scrambling to prepare for potential stock market turmoil and political changes, but history shows that stocks have consistently posted strong gains toward the end of a presidential term despite short-term volatility. According to Seema Shah, chief global strategist at Principal Asset Management.

Since 1933, stocks have “almost always” risen by double digits at the end of a president’s term, regardless of the president’s party affiliation, according to data compiled by Principal Asset Management.

Markets are also struggling with uncertainty around them When can the race be called? and with the possibility of a contested result. But while those factors can cause a spike in short-term volatility, they are often quickly overshadowed by longer-term gains in stocks driven by economic growth, corporate earnings and innovation, Shah said in emailed comments Monday.

“It’s worth remembering that while markets fell in the immediate aftermath of the 2016 election and struggled to find direction in the days of uncertainty following the 2020 election, in both cases the markets then showed sustained gains over four years,” she said.