Prominent Democratic leaders in swing states, including Michigan and Wisconsin, have raised concerns over the last week over improved polling for former President Donald Trump in key demographics. While these marginal shifts are statistically insignificant in a tight national race, financial markets have reacted to data showing Vice President Kamala Harris in a more vulnerable position.
The policy research group led by Daniel Clifton at Strategas created two equity portfolios tied to the policies of both candidates. Over the past week, market indicators have reversed somewhat, improving the projected odds for the Republican candidate.
In renewable energy and other ESG sectors, sentiment has shifted more dramatically. UBS analysts noted in a research note to clients on Thursday that since President Joe Biden withdrew from the race, the iShares Global Clean Energy ETF ICLN has closely tracked Harris’s momentum. The ETF saw gains of up to 3% following her DNC acceptance speech in late August and her strong debate performance in September. However, ICLN has declined by roughly 4% over the past week of trading.
Adding to market uncertainty is the potential political impact of Hurricane Helene and Hurricane Milton. The economic toll of disaster response may shape voter perceptions of Harris. According to Clifton with Strategas: “The vice president typically doesn’t have a role in disaster response efforts, but Harris the candidate is looking to project competency, contrasting herself with Trump’s chaos, without looking overtly political.”
Clifton added: “It’s a high-stakes situation in what could turn out to be the defining October surprise of the campaign.”
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Recovery efforts from Hurricane Milton are underway as rebuilding continues in areas affected by Hurricane Helene in late September. On Wednesday, Dominion Energy announced that power had been fully restored to all customers in South Carolina, where the company operates seven solar facilities.
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