Market Gains as Bush Rises and Kerry Falls
September is ordinarily a poor month for the tens of millions of Americans who are investors. Not this time, thanks to President Bush and, in a backhanded slap, Sen. John Kerry.
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"A 'Bush Rally' is buoying stocks in the market's historically weakest month, underscoring the increased attention investors are paying to politics and terrorism," the Wall Street Journal reported.
The Irish Web site TradeSports.com has caught on with market watchers as well as gamblers. "In recent weeks, a chart of President Bush's re-election chances based on TradeSports odds has looked surprisingly like the chart of the Dow Jones Industrial Average," the paper noted Monday.
"The two have been moving more or less in tandem for months, and the link seems to have kicked in most strikingly around the start of June – about the time the election battle lines began to firm up. The TradeSports data show that expectations of a Bush re-election were rising until mid-January of this year, when they topped out at about 75%. The betting then turned against Mr. Bush, and his odds fell to just less than 50% around the end of July. Then the betting swung back his way, hovering at about 70% yesterday."
More bad news for the protege of Teddy Kennedy and Michael Dukakis. "The interpretation seems obvious: When investors think Mr. Bush is going to win, stocks tend to rise. When the market sees Democratic challenger John Kerry's chances rising, it tends to fret."
GOP congressional and gubernatorial candidates aren't the only ones who seem to be riding the president's coattails. "The Dow industrials and Standard & Poor's 500-stock index began their slide in mid-February, a few weeks after Mr. Bush. They pulled out of that slide in mid-August, and the Dow industrials are up 1.1% in September – a month that has had an average loss of 1.23% since their inception in 1896."
John Caldwell, chief investment strategist at McDonald Financial Group, told the Journal: "It's eerie. It is a pretty strong relationship."
URL:http://www.newsmax.com/archives/ic/2004/9/22/170101.shtml |
