July 16, 2004

Wall Street and the election

My quick take on using Wall Street as an election guide.
10,500 on the Dow at or just after Labor Day is the magic number this year in my eye. Above that, a Bush election is more likely; below, a Kerry election.
With further fine-tuning, a market sloping down from 10,500 to 10,000 is a slowly increasing, but still moderately more likely chance of a Kerry win. Below the psychological barrier of 10,000, it's Kerry's baby. The same holds true for Bush from 10,500-11,000, with that serving as a psychological barrier.
These numbers have even more potency after Oct. 1, when the election enters the home stretch.
Updated July 23
With the Dow now below the 10,000 mark, Kerry has an opportunity, with the Democratic convention upcoming, to hammer away on this economic angle.