Ed Glissold, strategist at research firm Ned Davis Research, told Business Insider that the strong stock market rally earlier this year was good news for U.S. President Joe Biden.

If stocks do well early in an election year, the incumbent party is usually in power, Glissault says. “This is especially true for Democrats.”

The broader U.S. S&P 500 index has risen more than 8 percent since the start of the year. Based on the current rally Strong economic growth and investors’ expectations of the Federal Reserve This year the policy will cut the interest rate again.

This will boost Biden’s re-election campaign Encouragement can give.

He could use it: Many voters doubt the physical and mental health of the now 81-year-old president. Further He will lose votes For his stance on the conflict between Israel and Hamas.

Stock market rally could get Biden votes in presidential election

Historically, the stock market tends to perform weakly at the start of an election year in the US, with an average decline of 1 percent.

But if the incumbent party wins the election, the share price will rise at the beginning of the year.

“When an incumbent Democrat wins, the Dow Jones Industrial Average falls [DJIA, een belangrijke Amerikaanse aandelenindex, red.] “The average increase in the first two months of the year was 2.6 percent,” Glissault says. “When an incumbent Democrat lost, there was actually a 6.2 percent decline.”

The DJIA is up more than 3 percent since the start of the year.

While Clissold admits that stock market performance isn’t a strong indicator of election results, it’s still worth paying attention to. If stock prices rise, it means the economy is doing well and consumer confidence is improving. That could certainly win votes for Biden.

Also Read: What if Biden Drops Out of the Presidential Race? And then the same thing that happened in 1968 will happen (English)