🧐 How do midterm elections affect the stock market? Citigroup’s report reviews midterm elections since 1960, breaking down market performance along a timeline (with November 3 as T0): ✔️ Approximately 50 trading days before the election: Risk premium rises. ✔️ Current baseline scenario: Divided government (opposition party controls at least one chamber). Calendar breakdown: 🔹 60 to 30 trading days before the election: Uncertainty intensifies; equities tend to pull back, volatility rises. 🔹 30 trading days before the election to election day: Risks are fully priced in; equities may rally in advance, volatility peaks. 🔹 Election day to 50 trading days after: If divided government materializes, fiscal constraints on U.S. Treasuries strengthen, and the advantage of defensive sectors weakens. 🔹 50 to 100 trading days after the election: Cyclical sectors such as growth, technology, and industrials are more likely to recover. Historically, technology stocks tend to outperform most after elections, followed by industrials; defensive sectors like healthcare, consumer staples, and utilities tend to underperform. Source: @qinbafrank