U.S. investors understandably tend to love capitalism and its mantra of a free market. They typically hate anti-business social programs and tax increases. It’s why, in American politics, investors generally scorn free-spending Democrats and favor presidents from the ranks of fiscally-minded Republicans.
For many this assumption has come to be a stock market rule. Actually, it’s all wrong.
Since the beginning of the 20th century, the S&P 500 stock index in the United States has increased 10 percent annually on average when Democrats are in the Oval Office. With Republican presidents, according to calculations by Fidelity financial services, share prices rose by barely 2 percent a year.