Stock Market Indicators:

S&P 500
Presidential Cycles
Yardeni Research, Inc.

July 31, 2023

Dr. Edward Yardeni

516-972-7683
eyardeni@yardeni.com

Joe Abbott
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jabbott@yardeni.com

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thinking outside the box

Table Of Contents Table Of Contents
Stocks & Politics 1
First & Second Terms 2
Presidential Cycles 3-4
S&P 500 Index & P/E 5
Misc. 6

July 31, 2023 / Stock Market Indicators: S&P 500 Presidential Cycles Yardeni Research, Inc.
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 Stocks & Politics
Figure 1.
5415 5415
4515 Jul 4515
3615
S&P 500 DURING SIX-MONTH PERIODS AROUND PRESIDENTIAL ELECTIONS 3615
(weekly, ratio scale)
2715 2715

1815 1815

915 915
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3.5 -8.9 11.4 6.8 -0.7 0.5 -3.0 7.3 8.7 10.5 7.1 21.3 -18.3 9.0 -42.7 7.7 8.9 8.9
15 15
51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 25 27

Note: Shaded areas in green (red) are when the S&P 500 is up (down) during the six months from September to February around presidential elections.
Numbers above timeline are percentage changes over those six-month periods.
Source: Standard & Poor’s.

Figure 2.
7504 7504
6004 FDR DDE JFK RMN JEC RWR WJC GWB BHO DJT JRB 6004
4504 HST LBJ GRF GHWB Jul 4504
3004 3004

1504 S&P 500 INDEX* & PRESIDENTS 1504

BLUE DEMOCRATS vs. RED REPUBLICANS
(ratio scale)

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285.6 118.7 78.7 3.5 26.3 220.9 203.0 -31.6 140.3 71.2
4 4
30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26 28

* End-of-month daily data.

Note: Blue (red) shades represents Democrats (Republicans) in White House. Data above timeline are percentage changes in S&P 500 for each shade.
Source: Standard & Poor’s.

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 First & Second Terms
Figure 3.
10004 10004
8004 Roosevelt Eisenhower KennedyNixon Carter Bush I Bush II Obama Trump 8004
6004 Truman Johnson Ford Reagan Clinton Biden 6004
4004 Jul 4004

2004 2004
S&P 500 INDEX* & PRESIDENTIAL FIRST TERMS
(ratio scale)

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149.3 74.8 75.6 45.8 13.7 26.3 23.2 56.9 70.0 -8.2 57.9 67.8
4 4
30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26 28

* End-of-month daily data through 12/31/2020.

Note: Shaded areas represent first term of each president. Blue shade represents Democrats. Red shade represents Republicans.
Data above timeline are percentage changes for each shade.
Source: Standard & Poor’s.

Figure 4.
6004 6004
5004 Roosevelt Eisenhower Nixon Reagan Clinton Bush II Obama Jul 5004
4004 4004
3004 3004
2004 2004

1004 S&P 500 INDEX* & PRESIDENTIAL SECOND TERMS 1004

(ratio scale)

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-38.4 24.5 -9.0 66.1 78.2 -25.5 52.2

4 4
30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26 28

* End-of-month daily data through 8/31/2016.

Note: Shaded areas represent second term of each president. Blue shade represents Democrats. Red shade represents Republicans.
Data above timeline are percentage changes for each shade.
Source: Standard & Poor’s.

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 Presidential Cycles
Figure 5.
6003 6003
5003 Jul 5003
4003 4003
3003 S&P 500 INDEX* & 3003
2003 FIRST YEAR OF PRESIDENTIAL TERMS: 1929-now 2003
(average = 6.7%, ratio scale)
1003 1003

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-11.9 46.6 -38.6-17.9 30.7 10.3 -6.6 -14.3 23.1 9.1 -11.4-17.4-11.5 -9.7 26.3 27.3 7.1 31.0 -13.0 3.0 23.5 29.6 19.4 26.9
3 3
25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30

* End-of-month daily data through 12/31/2021.

Note: Shaded areas are the first years of presidential terms. Data above timeline are percentage changes for the first year using daily price data.
Source: Standard & Poor’s.

Figure 6.
6003 6003
5003 Jul 5003
4003 4003
3003 S&P 500 INDEX* & 3003
2003 SECOND YEAR OF PRESIDENTIAL TERMS: 1929-now 2003
(average = 3.3%, ratio scale)
1003 1003

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-28.5 -5.9 25.2 12.4 -11.9 21.8 45.0 38.1 -11.8-13.1 0.1 -29.7 1.1 14.8 14.6 -6.6 -1.5 26.7 -23.4 13.6 12.8 11.4 -6.2 -19.4
3 3
25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30

* End-of-month daily data through 12/31/2022.

Note: Shaded areas are the second years of presidential terms. Data above timeline are percentage changes for the second year using daily price data
Source: Standard & Poor’s.

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 Presidential Cycles
Figure 7.
6003 6003
5003 Jul 5003
4003 4003
3003 S&P 500 INDEX* & 3003
2003 THIRD YEAR OF PRESIDENTIAL TERMS: 1929-now 2003
(average = 13.5%, ratio scale)
1003 1003

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-47.1 41.4 -5.5 19.4 0.0 16.5 26.4 8.5 18.9 20.1 10.8 31.5 12.3 17.3 2.0 26.3 34.1 19.5 26.4 3.5 0.0 -0.7 28.9
3 3
25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30

* End-of-month daily data through 12/31/2019.

Note: Shaded areas are the third years of presidential terms. Data above timeline are percentage changes for the third year using daily price data.
Source: Standard & Poor’s.

Figure 8.
6003 6003
5003 Jul 5003
4003 4003
3003 S&P 500 INDEX* & 3003
2003 FOURTH YEAR OF PRESIDENTIAL TERMS: 1929-now 2003
(average = 6.1%, ratio scale)
1003 1003

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-15.1 27.9 -15.3 13.8 -0.7 11.8 2.6 -3.0 13.0 7.7 15.8 19.1 25.8 1.4 12.4 4.5 20.3 -10.1 9.0 -38.5 13.4 9.5 16.3
3 3
25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30

* End-of-month daily data through 12/31/2020.

Note: Shaded areas are the fourth years of presidential terms. Data above timeline are percentage changes for the fourth year using daily data.
Source: Standard & Poor’s.

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 S&P 500 Index & P/E
Figure 9.
9050 9050
7550 Kennedy Nixon Carter Reagan Clinton Bush II Obama Trump 7550
6050 Johnson Ford (+27.9) Bush I (+209.9) (-40.0) (+140.3) 6050
(+69.6) (+1.3) (+229.7)
4550 7/28 4550

3050 3050

1550 S&P 500 INDEX* & PRESIDENTS’ PARTIES 1550

(weekly, ratio scale)

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50 50
60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26

* End-of-month daily data through August 31, 2016.

Note: Shaded areas represent periods when one party holds the presidency. Blue shade represents Democrats. Red shade represents Republicans.
Numbers in parenthesis show S&P 500 increase or decrease during each president.
Source: Standard & Poor’s.

Figure 10.
28 28
27 S&P 500 FORWARD P/E RATIO* 27
26 26
25 Carter Reagan/Bush I Clinton Bush II Obama Trump Biden 25
24 24
23 23
22 22
21 21
20 Jul 20
19 19
18 Average = 14.2 18
17 17
16 16
15 15
14 14
13 13
12 12
11 11
10 10
9 9
8 8
7 7
6 6
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5 5
77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19 21 23 25 27 29 31

* Average monthly S&P 500 stock price index divided by S&P 500 12-month forward consensus expected operating earnings per share.
Source: I/B/E/S data by Refinitiv.

Page 5 / July 31, 2023 / Stock Market Indicators: S&P 500 Presidential Cycles Yardeni Research, Inc.
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 Misc.
Figure 11.
25 25
FDR Eisenhower Kennedy Nixon Carter Reagan Clinton Bush II Obama Trump
Truman Johnson Ford Bush I Biden

20 Jun 20

15 15

10 10

PAYROLL EMPLOYMENT & PRESIDENTS

5 BLUE DEMOCRATS vs. RED REPUBLICANS 5
(120-month change)

0 0

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-5 -5
46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26 28 30

Note: Blue (red) shades represents Democrats (Republicans) in White House.

Source: Bureau of Labor Statistics.

Figure 12.
25 25
FDR Eisenhower Kennedy Nixon Carter Reagan Clinton Bush II Obama Trump
Truman Johnson Ford Bush I Biden

20 20

15 15
Jun

10 10

PAYROLL EMPLOYMENT & PRESIDENTS

5 BLUE DEMOCRATS vs. RED REPUBLICANS 5
(96-month change)

0 0

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-5 -5
46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 26 28 30

Note: Blue (red) shades represents Democrats (Republicans) in White House.

Source: Bureau of Labor Statistics.

Page 6 / July 31, 2023 / Stock Market Indicators: S&P 500 Presidential Cycles Yardeni Research, Inc.
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