The preferred party?
Republicans are viewed as the preference of Wall Street (any article comparing the stock market of the last 30 years with the stock market of the earlier period (prior to circa 1980 automatically lacks credibility because of the serious differences in how the markets are no longer regulated, and how the markets are manipulated by investors doing micro trades, and shorting, and well, just a whole host of things that were not parts of how markets worked prior to about 1978) . But that doesn't mean the stock moarket performs better when they're in the White House (I'd suggest the reason Republicans are favored by "Wall Street" is because Republicans are eager to embrace lower taxes (especially for the very rich), lower taxes on capital gains (most of the country does NOT own investment vehicles which pay capital gains) . Since World War II, the stock market has risen an average 58 percent under new Democratic administrations versus a 32 percent rise under first-term Republicans.
Thos figures include the initial four-year terms of candidates who won the prewsidency on Election Day. To be sure, there are numerous variables that influence market performance. residents may be limited by a Congress controlled by the other party. And it may take years to see the impact of policy changes, just to name two.
The two best market stretches have been under Democrats (who have been ably helped by Fed Chairfolks who like to cut interest rates when the stock market dives). The Standard & Poor's 500 index was up 79 percent during Bill Clinton's first term. It's up the same amount under Barack Obama with three months left. Dating to 1900, stocks have risen more under Democrats, according to Sam Stovall, chief equity strategist of S&P Capital IQ.
As Election Day approaces, Republicans are sure to argue that President Obama was bound to see a big rebound since he took office following a historic market crash . Another likely claim is that Democrats juiced stock prices artificially through spending, without regard to long-term economic consequences.
Although the comparisons aren't likely to settle any arguments about ultimately who's better for Wall Street, the numbers show that the market often responds favorably to a new administration.
SOURCE: S&P Capital IQ; FactSest
Graph / Chart
Market performance:
Change in the S&P 500 index during the first term of newly elected presidents."
R Eisenhower (1953-1957) ************** 70%
D Kennedy/Johnson (1961-1965) ********* 44%
R Nixon (1969-1973) *** 17%
D Carter (1977-1981) ****** 30%
R Reagan (1981-1985) ******^ 33%
R G H W Bush (1989-1993) **********^ 52%
D Clinton (1993-1997) **************** 79%
R Bush (2001-2005) -12%^**
D Obama **************** 79%
