Voters walk to vote during early voting for the presidential election at the C. Bryce Andrews Jr. Public Library polling place in Tampa, Florida, USA on November 1, 2024.
Octavio Jones Reuters
Executives at America’s largest companies are discussing the presidential election more publicly with investors than in recent cycles.
The word “election” appeared in 100 financial statements. S&P500Companies listed from Sept. 15 to Oct. 31, according to FactSet. This is the highest number of companies in the broad index to mention the word during the same period, according to CNBC programming from the same period dating back to 2004. The US presidential election will be held on Tuesday, November 5th.
The economy is on the minds of Americans as they head to the polls in what is shaping up to be a close race between Kamala Harris and Donald Trump. At the same time, white-collar leaders are weighing the impact of policy on their businesses, lamenting the general sense of instability that accompanies this political season.
“There may be a sense of a little bit of caution out there because of the uncertainty of the election and a variety of other reasons.” dover CEO Richard Tobin told analysts at the specialty manufacturer’s earnings call in late October.
John Butters, senior earnings analyst at FactSet, first pointed to the amount of companies discussing the election in recent weeks. Remarkably, his data shows that very few S&P 500 executives are talking about the race more broadly by mentioning Harris or Trump.
“cautious” client
Several companies cited a sense of unpredictability among consumers and business customers due to the presidential election.
in tractor supplyCEO Harry Lawton said customers were expected to remain “cautious” as in past election years. This came after the farm-focused retailer reported a surge in emergency response sales earlier in the quarter in response to hurricanes Helen and Milton.
southwest airlinesMeanwhile, operations chief Andrew Watterson said he expects there will be a “trough” in air travel around the presidential election. But when it comes to booking trends; royal caribbean Chief Executive Officer Michael Bailey said that although there has historically been no long-term impact from presidential elections, cruise lines could see some volatility during the campaign week.
A Southwest Airlines plane is serviced at the gate at Fort Lauderdale-Hollywood International Airport on May 18, 2024 in Fort Lauderdale, Florida.
Gary Hershawn | Corbis News | Getty Images
Beyond Election Day, market participants and business leaders are closely monitoring next week’s Federal Reserve monetary policy meeting. tool manufacturer stanley black and decker CEO Donald Allan cited both the election and interest rates as reasons to expect “market volatility” through the first half of 2025.
As of Friday night, federal funds futures priced in about a 96% chance of lower borrowing costs at the November meeting, according to CME Group’s FedWatch tool. This comes after the central bank announced its first rate cut since 2020 in September.
Stanley Black & Decker’s Alan also pointed to President Trump’s policies regarding taxes on imported goods, and said that the United States is “likely to end up with a new tariff system.” The Republican candidate said he plans to impose a 20% tax on imported goods and a special 60% tax rate on goods imported from China.
William Grogan, CFO, Water Infrastructure Company Kibesaid the election was one of the factors causing a “bit of a pause” in the industrial market for large projects. republic services CEO John Vander Ark said he expects waste companies to be “a little paralyzed in an election year,” but is optimistic heading into late 2024 and early 2025.
observe the economy
More broadly, CEO Eric Ashlman said: idexThe company, which makes parts for everything from airbags to DNA testing equipment, said recent races have not improved its economic situation.
Nonfarm payrolls growth in October was the slowest since late 2020 due to hurricanes and the Boeing strike. In this flow, equifax The company said background check numbers are softening as executives consider what the results mean for their businesses.
“I feel like as we get closer to the election, companies are being a little bit more cautious about hiring,” said Mark Begor, CEO of Equifax.
Indeed, some of this year’s references to “elections” were tied to unrelated events, such as the health insurance enrollment period. To other software companies tyler technologies Major credit card company american express He said he did not feel the election had an impact on his business.
“This company has been around for a long time,” American Express CEO Stephen Squeri told analysts last month. “Of course, 174 years ago we didn’t have cards. But we have participated in different elections. There were a lot of different configurations of the House of Representatives, the Senate, etc.”
stock housing Meanwhile, CEO Mark Parrell said state and local governments are considered more important to business than which party wins at the top. The company is a real estate investment trust that focuses on condominiums.
move forward
Still, this cycle appears to involve a uniquely large number of leaders within America’s largest corporations. The number of mentions in 2024 equates to the word “election” appearing in approximately one in five S&P 500 company calls during that period. It’s also more than triple the number of mentions during the same period in 2008.
DR Horton CEO Paul Romanowski said buyers were taking a “wait-and-see” approach given the expected fall in mortgage rates in 2025 and the stress associated with the election. He said the company is trying to increase demand by offering to buy home loans and focusing on building homes with smaller floor plans.
Another member of Dr. Horton’s executive team was more candid about the election.
“I think everyone will be happy that the election is over,” Chief Operating Officer Michael Murray told analysts on an earnings call. “I think it helps the buyer emotionally and helps them move forward with their life decisions.”
