- A Democratic sweep in November would place stocks on a rollercoaster ride through the end of the year, Morgan Stanley strategists said Friday.
- US equities are among the few assets poised for a “detour” should a so-called blue wave take place. The market’s steady climb would reverse temporarily before correcting in 2021, the analysts said.
- Stocks would initially dip on fears of higher corporate taxes and uncertainty around future stimulus, according to the bank.
- Once the party can clarify its fiscal relief plans, a follow-up to March’s CARES Act and continued economic recovery can place stocks back on their upward path, the strategists added.
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A “Blue Wave” come Election Day can boost stocks, but only after bouts of strong volatility and a knee-jerk decline, Morgan Stanley strategists said Friday.
Current polls suggest Democratic