The election will be good news, regardless of outcome, says Morgan Stanley’s chief stock-market strategist

The election will be good news, regardless of outcome, says Morgan Stanley’s chief stock-market strategist The election will be good news, regardless of outcome, says Morgan Stanley’s chief stock-market strategist With expectations for a Democratic sweep, the midterm elections may be a "clearing event" for the stock market, according to a Morgan Stanley strategist. The winner of the midterms is going to be the U.S. stock market. That’s the take from Morgan Stanley’s chief stock-market strategist, Mike Wilson, who said the midterms are a classic “clearing event” whose outcome at this point doesn’t really matter.

Since 1982, large-capitalization stocks have gained approximately 15% on a cap-weighted basis and 16% on an equal-weighted basis in the six months following midterms, with both measures rising roughly 22% over the subsequent year, he noted. Your daily dive into MarketWatch, featuring story spotlights, market movers and more you Need To Know to start your day. I agree to the Terms of Use, Privacy Notice and Cookie Notice.

I would like to receive updates and special offers from Dow Jones and affiliates. I can unsubscribe at any time. He even pointed to possible good news from a Democratic majority — citing possible efforts to delay or reverse Medicaid and food-stamp cuts that could support consumption.

Another potential bonus would be a pulling forward of investment and M&A activity to beat a shift in policy in 2028. That’s not to say Wilson doesn’t see threats. He identified the more significant risk is the potential for renewed military escalation with Iran or additional tariffs after the election.

Wilson said the correction that began in June is now in the final innings, with both the S&P 500 retreating as breadth improves. He said that since the end of September, 10-year Treasury yields have declined by nearly 40bp, while the percentage of S&P 500 stocks above their 200-day moving average has risen about 20 percentage points to 62%. During that time period, the equal-weighted S&P 500 has gained nearly 5%, outperforming the cap-weighted index by almost 6%, he said.

Relief may be coming after the midterms — no matter who wins.** Copyright ©2026 MarketWatch, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8 Your stock portfolio increasingly hinges on the bond market — and the midterm elections Marine sniper turned macro strategist says this bull market has six to 12 months left. Want to help your adult kids and grandkids?