A Warren presidency might not be so bad for stocks, RBC says

Concern on Wall Street has been rising along with 2020 Democratic presidential contender Elizabeth Warren’s poll numbers. But worries about her potential success may be overdone, according to RBC Capital Markets.

“Any pain from a Warren win is likely to be temporary,” Lori Calvasina, RBC’s head of U.S. equity strategy, wrote in a report Monday that was partially underpinned by a survey of RBC industry analysts. “Most of the sectors at high risk under a Warren presidency from a policy perspective (Financials, Energy, Health Care, Industrials) are already deeply undervalued versus the broader market.”

Warren has pitched ideas like “accountable capitalism,” and advocated for consumers. Her recent surge in key state and national polls has stoked concern about sectors such as biotechnology, for-profit schools, health insurance, and even the U.S. dollar. Some market players have voiced unease.

There’s potential for market winners as well, according to the RBC report. For one thing, the election of a progressive Democrat could be “supportive of the already growing popularity of ESG as an investment approach,” Calvasina said.

https://www.msn.com/en-us/money/markets/a-warren-presidency-might-not-be-so-bad-for-stocks-rbc-says/ar-AAIoBjH?li=BBnbfcN

The markets usually do better under Democratic administrations. CEO bonuses on the other hand might not be as generous under Warren.