Uncertainty breeds volatility

Reader comment on: Stock Market Does Better Under Democrats

Submitted by Steve H (United States), Jan 24, 2017 17:05

To your point, stock prices reflect future expectations. On the other hand, the stock market hates uncertainty leading to volatility (often negatively). Once the election was over, expectations (predictions) of what the future administration was all about settled the market down and expectations (certainly in certain sectors) blossomed. Perhaps they would have been different sectors had Clinton won the election. Nevertheless, the uptick in the stock market (I believe) was largely due to pent up activity waiting for less "uncertainty" once a new administration was selected. Of late, it has calmed down and we're likely in for a another "ride".

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