The presidential elections are held after every four eyes and have a great effect on the stock market and economy at large. U.S stock market is one of the large markets in the world. A country’s economy depends much on the trends in the stock market .There exist a wide range of factors, both within and out of the country, which can manipulate the stock markets. The market trends adapt to the changes it experiences to survive. The profits or losses traders incur depend on the changes in the market trends. The U.S stock market is seen to dwindle depending on different terms of leadership. This paper attempts to find out the relationship between the presidential elections and the U.S stock market. It is much inclined to how the different eras result to the U.S. Stock market.
To carry out this study efficiently, we highlighted the following variables: Party that wins the presidential elections, different election years from as far as the 1970s to 2010s, periods of recess, and the Interest rates. This study is to find out how each of the named factors, (independent variables) affects the U.S. stock market. Based on our recent experiences, the markets rates changed immediately after elections in 2016, and it is up to now that it is taking shape. We chose to research on this phenomenon since the study will help us find out if the same ever happens with other general elections from the 1970s to the most recent polls. We are interested in finding out the relationship between the president in office and the economy during their tenure.
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Dow Jones Industrial Average Growth and Interest rates is the main tool in our study as it offers the rates as recorded during different presidents’ terms in office.
