How IHSG Has Performed Before Election
The content provided here is for informational purpose only. It is not an advise or recommendation. Please do your own research.
Key Summary:
- Equity tends to perform before election
- Biggest movers in blue chips and large cap stocks
- Seasonality could be a positive factor
Previously, our tactical call for November (read here) was correct as market rebounded from its October low. Next, with 90 days until the election, we take a look into past pre-election performances of IHSG. From 2004-2019, the past 5 Presidential elections (2004 twice given 2 rounds), 4 out of 5 saw positive returns.
Generally, we think that macroeconomic condition would have more impact towards IHSG than the political cycle and especially in terms of the magnitude of the return. Nonetheless, the trade setup looks supportive especially with seasonality and dovish monetary outlook until the year end.