According to a survey by RBC Capital Markets analysts, a significant win for the Republican Party under Donald Trump in the elections could be the most favorable outcome for the U.S. stock market. The energy and financial sectors stand to benefit the most from such a scenario.
The survey reveals that RBC's U.S. analysts believe Trump's victory in the November 5 election, along with a Republican majority in both houses of Congress, represents the best scenario for the stock market. A divided Congress could also slightly benefit the market.
Conversely, the most pessimistic scenario, according to the analysts, would be a sweeping victory for the Democratic Party under Kamala Harris. However, the survey shows only slight tendencies in opinions for all possible outcomes. This underscores the difficulty in accurately assessing the potential impacts of various policy proposals.
As the election day approaches, both parties are closely matched in the polls. Consequently, the potential effects of their respective policies have become a major focus for Wall Street.
The survey results indicate that a Trump victory might provide short-term benefits to the stock market, whereas a significant Democratic victory could pose short-term challenges. However, in the long run, the most crucial factor for the U.S. stock market is to get through the election period so that businesses and investors can understand the landscape they will face moving forward.
Neither election campaign has commented on the survey findings. RBC's survey included insights from 116 industry teams globally.
