- JPMorgan Private Bank’s Monica DiCenso told Bloomberg on Friday that the stock market won’t see the bullish outcome it’s expecting from a Biden win unless there’s a blue wave victory.
- The head of US equity strategy said that it will be difficult for Biden to pass a large stimulus bill without Democratic control of the Senate.
- The stimulus would also offset higher corporate taxes that are likely under a Democratic administration, she said.
JPMorgan Private Bank’s head of US equity strategy told Bloomberg on Friday that the stock market won’t see the bullish outcome it’s expecting from a Joe Biden victory unless there’s a full blue wave outcome.
“It does appear increasingly likely that we see a blue wave and I think that is what the market is pricing in right now when you see equities continue to move,” Monica DiCenso said.
The strategist explained that it will be much harder for Biden to pass a large stimulus bill without Democratic control of the Senate, and said: “I really do think you probably need the blue wave for the real bullish outcome that many people are talking about to come to fruition.”
DiCenso added that the stimulus, combined with continued low interest rates, will be the “perfect backdrop for equities over the near to intermediate term.”
While some investors are nervous that a blue wave will be negative for stocks because Biden’s corporate tax hikes will crush company earnings, DiCenso said the stimulus spending will offset higher taxes.
Read more: Fund manager Brandon Nelson is tripling his benchmark in 2020 with ‘less-discovered’ companies that become big winners. Here are 3 themes and