The Kobeissi Letter, a prominent markets commentary publication, posted on X today, October 27, 2026, that historical data suggests U.S. stocks tend to rally following Midterm elections. The publication stated that "The S&P 500 has returned +17.2% on average in the year following Midterm elections since 1950, the strongest return of any year in the Presidential cycle. The index has finished higher in 17 of the 19 post-Midterm years during this period." The post further detailed that this average return is nearly quadruple the +4.6% average recorded during midterm years themselves.
This observation comes as the S&P 500 is trading at $7,707, up +0.4% today. Recent coverage has focused on corporate earnings and economic indicators, with reports like American Tower Beats Q3 and PayPal's Margin Expansion Play highlighting company-specific performance. The broader market context includes ongoing discussions about inflation stickiness, as noted in recent Case Shiller Data, and the Federal Reserve's rate projections.
The Kobeissi Letter's analysis suggests that investors could anticipate a period of stronger equity performance in the coming year, based on historical patterns in the presidential cycle. The publication also noted that the S&P 500 has delivered an average return of +6.6% in the fourth quarter of Midterm years since 1950, marking the strongest quarterly return of the Presidential cycle. This historical tendency implies a potential tailwind for U.S. equities extending their rally.
