Fidelity: Since 1938, the S&P 500 has risen in the year following midterm elections with a 95% probabi

Fidelity reports that since 1938, the S&P 500 has risen in 95% of the 12-month periods following US midterm elections, with average returns of roughly 14%, versus about 5% average returns in the second year of a presidential cycle. Data from multiple institutions show that across 19 midterms since 1950, the index gained in every subsequent 12-month window, averaging about 15%, ranging from roughly 1% after 1986 to 33% after 1954; the only declines came after 1938 (about -5%) and a flat 1946. The upcoming midterm falls on November 3, and the S&P 500 is up more than 11% year-to-date with a maximum drawdown of about 9%—roughly half the typical midterm-year drawdown—suggesting stronger-than-normal momentum. Fidelity notes the pattern holds regardless of which party wins, though past performance does not guarantee future results. Investors will watch whether the historical post-midterm strength repeats given this year's already elevated gains and subdued volatility.