Stock market through the eyes of politics and fixed income

(1) Possible Biden elections victory and (2) HY FI OAS as indicators of stock market sentiment at the end of 2020.

Biden win predictions up to 66% from 56% in August, strongly correlated to SP500.

HY OAS is on the lowest level since February 2020 and has kept within 4.7 – 5.4 range for the last three months. Last few weeks it is has decreased below support level of 4.7 indicating bullish sentiment for the stock market, judged by the negative correlation throughout 2020.

#stockmarket #sp500 #stockstowatch #recession #fixedincome #sentimentanalysis #oas #bonds
(Chart sources: BoAM and SEB X-Asset)

Deni Memic

Academic Program Chair Finance at Higher Colleges of Technology - UAE