The midterm elections are almost here!
Early voting has already started in many states, and absentee ballots are pouring in from around the nation. But this year's highly-polarized midterms will not officially conclude until polls close on Election Day next week, so we can expect the heated contests to dominate our national attention until then.
The American political environment right now is, in a word, tense. Democrats and Republicans have seemingly grown further apart on both fiscal and social issues, and it has resulted in fierce public debate throughout our society.
This has created a sense of uncertainty in Congress, where plenty of lawmakers are facing tough electoral battles in this midterm cycle. Many of these elections will come down to the wire, and although current polls—and historical trends—suggest the Democrats have a good shot at taking back the House, the exact makeup of our legislative branch after all votes are tallied is still very much in question.
Moreover, elections and ballot initiatives on the state and local levels are bound to be tight. All around the nation, citizens will be voting on lawmakers and new laws alike, and there seems to be more at stake than on any other midterm Election Day in recent memory.
The results of next week's voting are still unknown, but if anything is for certain, it is that Wall Street will be keeping a close eye on the races that could have an impact on policy—and inherently, the economy and stock prices—in the near future.
While prudent investors should be prepared for all possible outcomes, here's a closer look at three key talking points ahead of the midterms.
Infrastructure Spending Is on the Table
If the Democrats manage to gain a majority in the House of Representatives and the Republicans keep control of the Senate, it will result in a split Congress during what is already an unprecedentedly deadlocked period for the legislative branch.
That means, if anything is going to get done, both parties will need to work together. Bipartisan agreement has been limited as of late, but if there is one thing that Democrats and Republicans might be able to work together on, it is infrastructure spending.
A massive infrastructure spending package has been on President Trump's to-do list since he took office, and the Democratic Party recently added a $1 trillion infrastructure plan to their party platform. It will take some artful negotiating, and while that might sound optimistic in today's environment, it is certainly possible.
Look for infrastructure spending to become a major policy initiative for both parties if the midterms result in the aforementioned scenario. Wall Street will likely match that rhetoric with bullishness for major industrials and contractors that could ink deals with the government or benefit from a spike in short-term demand.
More . . .
------------------------------------------------------------------------------------------------------
The Next Big Buying Opportunity
The midterm elections could have a huge positive impact on the markets – and certain stocks will get an even bigger boost under the new Congress. Zacks created Midterm Profit Strategies to help you profit from the changes to come.
In the report, you'll discover 2 stocks to own for each possible election outcome and our favorite marijuana stock set to benefit from new legalization.
Just before the 2016 election, we released a similar report with stocks that climbed +53%, +70%, +71%, and +83%. We believe these midterm picks could be even more lucrative.1
See Midterm Stocks Now >>
------------------------------------------------------------------------------------------------------
The Trade War Could Be Curtailed
The Trump administration instilled some confidence in its trade negotiating skills when it agreed to a revised version of NAFTA with Mexico and Canada recently, but the "trade war" between the U.S. and China still rages on, and it has become one of the biggest headwinds facing stocks this year.
President Trump and Chinese President Xi Jinping have trade talks scheduled in the coming months, and officials on both sides would probably still suggest that a constructive deal can get done. Nevertheless, the tariffs that have already been put in place are already having an impact on input costs for companies and denting the earnings outlooks of some industries.
If trade talks break down, there is a distinct possibility that a post-midterm Congress would look to curtail the president's tariff power in order to give affected businesses reprieve. After all, Congress is the entity that is granted the power to levy tariffs; the executive branch has only flexed that power because previous legislatures have granted it that ability.
A bipartisan coalition—especially one that does not have the pressure of the midterms beating down on it—might be able to generate the veto power needed to force through a tariff-related resolution. Investors should be prepared for this to become a louder talking point after midterms if no progress is made in U.S.-China trade talks.
Don't Forget About Marijuana
The legalization of cannabis, in some form, will be on ballots in seven states. It goes without saying that Wall Street has had marijuana fever this year, as pot stocks have swung up and down on speculative trading and excitement over the new recreational market in Canada.
Most of the pure play options in this space right now are Canadian companies. Some of these businesses have aspirations of moving south to the United States as new markets open.A few of them will succeed.
In other words, investing in Canadian marijuana stocks remains risky. But these firms are not the only options for investors looking to gain exposure to marijuana—especially if one is trying to bet on rapid growth in America.
Due diligence reveals that there are a handful of companies looking to position themselves to benefit from U.S. medical and recreational cannabis. Those markets could grow quickly based on the results of next week's initiatives, and that means Wall Street will once again be looking toward the pot stocks in the wake of state voting.
Targeting Strong Returns from Midterm Results
In any case, the midterm elections could create an attractive buying opportunity for savvy investors.
Both Republicans and Democrats have plans for policies they want to push forward after elections. Different scenarios will have different impacts on the market and economy. This article has only briefly touched on a few of them.
Our research team has created a special report that dives more deeply into the details. More importantly, it reveals two stocks we predict will soar for each possible election result.
Midterm Profit Strategies: Zacks' Top Trades for Each Election Outcome offers our best advice for targeting maximum gains after the winners are announced. Plus, you'll also learn about our favorite marijuana stock we believe will benefit from the seven states voting on cannabis initiatives.
Just before the 2016 presidential election, we released a similar report. Our recommendations crushed the market with gains of +53%, +70%, +71% and +83% in the months following the election.1 This year's returns could be even bigger.
The Midterm Profit Strategies report is only available until Sunday, November 4.
With less than a week until Election Day, now is the time to get started.
Click Here to Claim Your Copy of the Midterm Profit Strategies Special Report >>
Good Investing,
Ryan
Ryan McQueeney runs Zacks Income Investor portfolio service. He also creates and edits a wide range of content for Zacks.com, including articles for the "Stocks in the News" blog section and two finance-focused podcasts.
¹ The results for the trades listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors.
Image: Bigstock
3 Things Investors Need to Know Ahead of the Midterms
The midterm elections are almost here!
Early voting has already started in many states, and absentee ballots are pouring in from around the nation. But this year's highly-polarized midterms will not officially conclude until polls close on Election Day next week, so we can expect the heated contests to dominate our national attention until then.
The American political environment right now is, in a word, tense. Democrats and Republicans have seemingly grown further apart on both fiscal and social issues, and it has resulted in fierce public debate throughout our society.
This has created a sense of uncertainty in Congress, where plenty of lawmakers are facing tough electoral battles in this midterm cycle. Many of these elections will come down to the wire, and although current polls—and historical trends—suggest the Democrats have a good shot at taking back the House, the exact makeup of our legislative branch after all votes are tallied is still very much in question.
Moreover, elections and ballot initiatives on the state and local levels are bound to be tight. All around the nation, citizens will be voting on lawmakers and new laws alike, and there seems to be more at stake than on any other midterm Election Day in recent memory.
The results of next week's voting are still unknown, but if anything is for certain, it is that Wall Street will be keeping a close eye on the races that could have an impact on policy—and inherently, the economy and stock prices—in the near future.
While prudent investors should be prepared for all possible outcomes, here's a closer look at three key talking points ahead of the midterms.
Infrastructure Spending Is on the Table
If the Democrats manage to gain a majority in the House of Representatives and the Republicans keep control of the Senate, it will result in a split Congress during what is already an unprecedentedly deadlocked period for the legislative branch.
That means, if anything is going to get done, both parties will need to work together. Bipartisan agreement has been limited as of late, but if there is one thing that Democrats and Republicans might be able to work together on, it is infrastructure spending.
A massive infrastructure spending package has been on President Trump's to-do list since he took office, and the Democratic Party recently added a $1 trillion infrastructure plan to their party platform. It will take some artful negotiating, and while that might sound optimistic in today's environment, it is certainly possible.
Look for infrastructure spending to become a major policy initiative for both parties if the midterms result in the aforementioned scenario. Wall Street will likely match that rhetoric with bullishness for major industrials and contractors that could ink deals with the government or benefit from a spike in short-term demand.
More . . .
------------------------------------------------------------------------------------------------------
The Next Big Buying Opportunity
The midterm elections could have a huge positive impact on the markets – and certain stocks will get an even bigger boost under the new Congress. Zacks created Midterm Profit Strategies to help you profit from the changes to come.
In the report, you'll discover 2 stocks to own for each possible election outcome and our favorite marijuana stock set to benefit from new legalization.
Just before the 2016 election, we released a similar report with stocks that climbed +53%, +70%, +71%, and +83%. We believe these midterm picks could be even more lucrative.1
See Midterm Stocks Now >>
------------------------------------------------------------------------------------------------------
The Trade War Could Be Curtailed
The Trump administration instilled some confidence in its trade negotiating skills when it agreed to a revised version of NAFTA with Mexico and Canada recently, but the "trade war" between the U.S. and China still rages on, and it has become one of the biggest headwinds facing stocks this year.
President Trump and Chinese President Xi Jinping have trade talks scheduled in the coming months, and officials on both sides would probably still suggest that a constructive deal can get done. Nevertheless, the tariffs that have already been put in place are already having an impact on input costs for companies and denting the earnings outlooks of some industries.
If trade talks break down, there is a distinct possibility that a post-midterm Congress would look to curtail the president's tariff power in order to give affected businesses reprieve. After all, Congress is the entity that is granted the power to levy tariffs; the executive branch has only flexed that power because previous legislatures have granted it that ability.
A bipartisan coalition—especially one that does not have the pressure of the midterms beating down on it—might be able to generate the veto power needed to force through a tariff-related resolution. Investors should be prepared for this to become a louder talking point after midterms if no progress is made in U.S.-China trade talks.
Don't Forget About Marijuana
The legalization of cannabis, in some form, will be on ballots in seven states. It goes without saying that Wall Street has had marijuana fever this year, as pot stocks have swung up and down on speculative trading and excitement over the new recreational market in Canada.
Most of the pure play options in this space right now are Canadian companies. Some of these businesses have aspirations of moving south to the United States as new markets open.A few of them will succeed.
In other words, investing in Canadian marijuana stocks remains risky. But these firms are not the only options for investors looking to gain exposure to marijuana—especially if one is trying to bet on rapid growth in America.
Due diligence reveals that there are a handful of companies looking to position themselves to benefit from U.S. medical and recreational cannabis. Those markets could grow quickly based on the results of next week's initiatives, and that means Wall Street will once again be looking toward the pot stocks in the wake of state voting.
Targeting Strong Returns from Midterm Results
In any case, the midterm elections could create an attractive buying opportunity for savvy investors.
Both Republicans and Democrats have plans for policies they want to push forward after elections. Different scenarios will have different impacts on the market and economy. This article has only briefly touched on a few of them.
Our research team has created a special report that dives more deeply into the details. More importantly, it reveals two stocks we predict will soar for each possible election result.
Midterm Profit Strategies: Zacks' Top Trades for Each Election Outcome offers our best advice for targeting maximum gains after the winners are announced. Plus, you'll also learn about our favorite marijuana stock we believe will benefit from the seven states voting on cannabis initiatives.
Just before the 2016 presidential election, we released a similar report. Our recommendations crushed the market with gains of +53%, +70%, +71% and +83% in the months following the election.1 This year's returns could be even bigger.
The Midterm Profit Strategies report is only available until Sunday, November 4.
With less than a week until Election Day, now is the time to get started.
Click Here to Claim Your Copy of the Midterm Profit Strategies Special Report >>
Good Investing,
Ryan
Ryan McQueeney runs Zacks Income Investor portfolio service. He also creates and edits a wide range of content for Zacks.com, including articles for the "Stocks in the News" blog section and two finance-focused podcasts.
¹ The results for the trades listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors.