November 7, 2022, 9:47 pm EST
Waiting for the US Election
Low volume on the day before US mid-term election discounted the 423 points gains in the Dow Jones index. Although S&P 500 and Nasdaq also scored +0.96% and +0.85% gains, their low volumes also indicated a lack of commitment before the US November 8th election.
US politics will be checked by voters to see their feeling about inflation and coming massive layoffs. The falling housing markets could be another pain for the existing homeowners to see their equity keep shrinking. Falling home prices may not be good news for potential buyers when they notice the interest rates for qualification and mortgages are about 7%. This is about a 100% increase compared to the beginning of 2022.
The election results may alter the coming policies for both US and worldwide. Thus, investors would hold off their commitment until post-election.
In the past month, Dow Jones became the winner versus the loser Nasdaq. This divergence could continue because of the energy, material, industrial, and healthcare sectors where the Nasdaq index has much less weight on them.
Those sectors are also our attention if there is any upside potential.