The US election is not as important to the capital market as some think: RBC survey by Investing.com

Investing.com — The upcoming U.S. election, while relevant, may not matter as much to the overall stock market as some expect, a recent survey by RBC Capital Markets suggests.

“The event is relevant to US equity markets, but perhaps less so than some market participants might think,” the RBC team noted, citing the results of the survey that interviewed 116 analysts from various sectors. The survey was conducted between September 11 and September 20.

For many sectors, election relevance remains neutral to slightly positive, especially compared to broader economic factors.

A Republican drive, especially one led by former President Trump, is seen as modestly optimistic.

According to RBC, sectors such as energy and financials stand to benefit the most in such a scenario, while a Democratic analysis led by Vice President Harris paints a more bearish outlook, though those views are tepid.

Sector-wise, Industrials, Financials and Utilities rank highest in terms of relevance in the US, while other sectors such as Consumer Discretionary and Information Technology show only neutral to mixed views.

Outside the US, the election’s impact appears even more moderate, with analysts in regions such as Australia and Europe showing limited concern about the outcome.

“Across all regions, 51% said the event was relevant (44%) or very relevant (7%). It is worth noting that the overall relevance score for the US, while positive, was still quite light, coming in at 0.7,” the RBC note said.

Overall, RBC notes that uncertainty surrounding the election could lead to short-term volatility in the market. Specifically, a Trump victory is seen as a potential short-term positive for stocks, while a Democratic sweep could have a short-term negative impact.

However, the firm stresses that the market’s main concern is simply “getting past the event so that companies and investors know what they are dealing with”.