Goldman Sachs Says Election Winner Could Be Obvious Tonight—Here’s How


In a note to clients and investors on Tuesday, analysts from Goldman Sachs laid out a scenario wherein—contrary to many expectations—there is a “good chance” the winner of the presidential election will be clear to Wall Street on Tuesday night.

Key Facts

Goldman’s analysts noted four Sun Belt states—Arizona, Florida, Georgia and North Carolina—where Biden is leading narrowly in the polls, which are expected to report results fairly quickly. 

If Biden wins any of those states, the analysts said, it would make it very difficult for President Trump to win the 270 electoral votes he needs for a second term, and markets are likely to believe Biden will win the election. 

If Trump wins those four states like he did four years ago, on the other hand, the race will hinge on the northern battleground states—Pennsylvania, Michigan and Wisconsin—that will likely take days to report their results.

In that case, the election outcome might not be clear until much later. 

Goldman also noted that the outcome of the Senate majority could also be relatively clear (though the exact margins will not be) on Tuesday evening, depending on the outcome in Arizona, Colorado, Georgia, Iowa, Maine and North Carolina.

Big Number

100 million. That’s how many ballots were cast before Election Day, a record-breaking early turnout made possible in part by enormous uptick in early and mail-in voting measures due to safety concerns caused by the coronavirus. All those mail-in ballots are the reason many experts say we aren’t likely to know the outcome of the election on Tuesday night; a number of states, including Michigan and Pennsylvania, aren’t allowed to start counting them until Election Day. 

Key Background

Investors are bracing for major volatility in the case of a contested election or delayed result, and preparing contingency plans for a victory from either candidate. They’re eagerly awaiting news of another round of federal coronavirus stimulus legislation, and at this point investors are overweight on what the Washington Post called the “Biden basket” of stocks: companies in those industries that stand to benefit from Biden’s policies if he wins, like clean energy and healthcare. 

Further Reading

When We’ll Know What On Election Day: A Guide To Poll Closing Times, Vote-Counting Procedures, And The States To Watch (Forbes)

Energized Electorate: A Record-Setting 100 Million Ballots Were Cast Before Election Day (Forbes)

The Finance 202: The stock market is betting on a Biden victory (The Washington Post)

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