Here are the most important days for the stock market between now and the November election, according to BofA

• There are key stock market catalysts on the horizon ahead of November.

• The Fed’s recent interest rate cut has reduced market uncertainty, for now.

• Oct. 4, Oct. 21 and Nov. 1 are dates investors should watch, BofA says.

There are a handful of key market catalysts that could shake up share prices between now and November.

With the Federal Reserve’s first interest rate cut of 2020 last week, a lot of uncertainty has been removed from the stock market — at least in the short term.

In a note Monday, Bank of America highlighted the most important days for the stock market between now and the presidential election in November.

The bank used option prices to map the implied movements of the S&P 500 for each day between now and the day after the election.

November 6

Technically, the day after the election, the most important day for the stock market is November 6, when markets can react to the results.

The bank expects a 2.5% move in the S&P 500 on Nov. 6 in either direction.

This will be an important day for investors because, assuming there is a clear winner, markets will begin to price in what kind of policies might be pursued during the four-year term of the 47th President of the United States United.

The stock market saw a similar-sized move the day after the previous presidential election, with the S&P 500 rising 2.2% on November 4, 2020.

October 4 and November 1

Investors will keep a close eye on the non-farm payrolls reports for September and October, due out on October 4 and November 1, respectively.

The options market is pricing in the S&P 500 by just over 1% on those days in both directions.

Bank of America said strong jobs reports and PMI data could fuel a rally in stock prices.

“We think good news is good news for stocks and positive surprises from these two data should be tailwinds for stocks going forward,” Bank of America said.

October 21

This date represents the expected day some mega-cap tech companies will announce their third quarter earnings results.

Option prices show an implied 1% move in either direction for the S&P 500.

“The big 3Q earnings week (Oct. 21-25) should also be a big catalyst for the market,” Bank of America said.

Investors will pay close attention to any updates on efforts to monetize AI technologies.

October 10

As the Fed turns its attention to the labor market from inflation, September’s CPI print is seen as having less of an impact on the stock market than other data releases.

The story continues

Options pricing suggests a daily change of just under 1% for the S&P 500 in either direction when September CPI data is released on October 10.

“Before the first cut, inflation data was the most important data to watch. But now that the Fed has started its tapering cycle, we think labor market data (eg NFP) will be more important to watch than inflation,” Bank of America. said.

Read the original article on Business Insider