The odds of a fourth-quarter stock market gain are particularly strong when there is a presidential race, according to research published in The Turnaround Letter, Boston.
The fourth quarter is normally positive for stocks, with 35 up quarters and only 11 down quarters since 1950.
But in election years, the Dow Jones industrial average rose 10 times and dropped only once during the fourth quarter, and that drop was less than two points.
If President Clinton wins, that could be bullish for the market in 1997.
The Dow rose in the year following three of the last four Democratic victories, while it declined five of seven times following Republican victories.
By looking at the stock market as a predictor of election results, things also look good for the incumbent.
September was a strong month for the market, as it was before three of the four Democratic presidential victories since 1950.
Prior to Republican White House victories, the Dow average fell five times in September and gained only twice.
