President Barack Obama’s re-election probably would push the Standard & Poor’s 500 Index lower this November because investors see his policies as “anti-business,” according to Steven Leuthold, chief executive officer and founder of the Leuthold Global Fund.
“Obama is leading to some degree, and I think if Obama is re-elected it would be somewhat of a negative for the market,” Leuthold said in an interview today on Bloomberg Television’s “In the Loop” with Betty Liu. “He’s kind of viewed still as anti-business. He has a lot of support from Wall Street in terms of money. I’m a social liberal but I’m a fiscal conservative.”
The S&P 500 will fail to reach its highs of 2007 as investors await the results of the election, Leuthold said. The benchmark gauge has climbed 10 percent this year through yesterday and reached 1,419.04 on April 2, about 10 percent from the record 1,565.15 it hit in October 2007. The measure has since lost about 2.4 percent after the Federal Reserve signaled it was refraining from further monetary stimulus.
In mid-February, the S&P 500 was posting its best start to a year since 1991 as Obama’s re-election odds increased, according to bets placed on Dublin-based bookmaker Intrade. The index has rallied 63 percent since Obama took office on Jan. 20, 2009.
Leuthold said in January that he was bullish on U.S. stocks in the near future. The Leuthold Global Fund has beat 71 percent of its rivals in 2012, according to data compiled by Bloomberg. He said today he likes airline stocks.
“Between now and the election, nothing is going to happen in terms of the deficit and bringing it down or anything like that,” he said. “We’ve never gridlock quite as bad as we have it now. You have no cooperation between Democrats and Republicans at this point and that’s what really bothers me in terms of them really getting something done.”