U.S. Stocks Face 20% Slide With Contested Election, BofA Says
- Swift election results will matter more than who wins
- Economy might face shock as business confidence would tumble
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Markets want to see a clear victory for either President Donald Trump or Democratic nominee Joe Biden within a week of the Nov. 3 contest. If there’s a contested election, stocks could slide as much as 20%.
That’s according to a team of BofA economists and strategists led by U.S. economist Michelle Meyer and equity and quant strategist Savita Subramanian. A “landslide victory for either Trump or Biden and rapid election conclusion would likely be welcomed by markets while a severely contested election could see risk-off and drive 10-year rates materially lower,” they wrote in a research note.