There is a chance that the year won't end up as badly as in the past, but it depends on who investors think will win the election.
If stocks rise between July 31 and October 31, then people are generally of the mind that the incumbent party will win. If equities fall, then the thinking is that a new party will take over, said Stovall. Again, it relates to uncertainty — as the saying goes, better the devil you know than the devil you don't.
This actually plays out in the polls, said Stovall. In 82 percent of the times that markets have climbed during August and October, the incumbent party has won. In 86 percent of the times the market has been down, the replacement party has won.
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Individual sectors could also experience more ups and downs in the run-up to the election. Once candidates are chosen and party platforms are revealed, investors will have a better sense as to what industries might either benefit or suffer, depending on who's elected.
While those platforms are still to be determined, Stovall pointed out that an industry such as coal, which recorded a near 80 percent price decline in 2015, could see a rebound if investors think that the Republicans, which tend to favor less stringent air-quality regulations, will take the White House.
On the other hand, U.S-based pharmaceutical companies could see prices fall if Democrats, which have said that they want to cap drug pricing, remain in office. "The markets will give a bit of clarity to the polls," said Stovall.