Election Year Stock Market History: What the S&P 500 Has Done After Every Midterm Since 1874

S&P 500 returns before and after every midterm since 1874, by party control and seat losses.

By Jack Caporal – Updated Oct 2, 2026 at 10:30 PM EST | Fact-checked by Frank Bass

Key Points

S&P 500 averages a 14% gain in the year after midterm elections, outperforming typical annual returns.
Market performance post-midterm is generally positive regardless of which party controls Congress.
Investors should focus on long-term fundamentals rather than short-term election results.

Since 1874, the S&P 500 has climbed in the year following 32 of the last 38 midterm elections, gaining an average of 14%, according to a Motley Fool analysis of election-year stock market history.

Neither how many seats the president's party loses in Congress nor which party ends up running Washington afterward has been closely tied to the S&P 500's return in the following year, according to a Motley Fool analysis of Robert Shiller's stock market data set, official U.S. House of Representatives election results, and U.S. Senate Historical Office Party Division records.

The historical record of stock market performance after midterm elections strengthens the case for long-term investing based on company fundamentals. It also suggests that trading on election odds or results, the way gamblers do on prediction markets like Kalshi, isn't a sound strategy.

How the stock market has performed before and after every midterm election since 1874

Midterm-year stock market history vs. the long-run average

Midterm-year returns have modestly outpaced the stock market's long-run average return, whether measured against any 12-month period since 1871 or against any November specifically.

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Data source: Motley Fool analysis of the Robert Shiller stock market data set, Yale University.
Period	Average 12-Month Return	Positive Share of the Time	Sample Size
Midterm election years (1874-2022)	14%	84%	38
Any 12-month period since 1871	11%	73%	1,857
Any November specifically	11%	74%	154

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About 150 million Americans own stock, either through a brokerage account or, for most, through a retirement account, according to Motley Fool research. How the market behaves around a midterm election and how investors react to it affect portfolios and retirement funds across the country. It isn’t just a concern for hedge funds and Wall Street traders.

Stock market returns before the midterm elections

The S&P 500 typically drifts slightly higher before a midterm election. The market has averaged a gain of 4% in the six months before a midterm and 1.5% in the month before Election Day, positive 63% and 76% of the time over those two windows.

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Data source: Motley Fool analysis of the Robert Shiller stock market data set, Yale University. All 38 midterms since 1874, total return.
Window Before Election	Average Return	Positive Share of the Time
1 month	1.5%	76%
3 months	2.1%	68%
6 months	4.1%	63%

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Stock market returns after midterm elections

Once the votes are counted, the market cools off, and the following month is more muted than the previous one.

The S&P 500 has averaged a gain of just 0.5% in the month after a midterm, positive only 55% of the time, compared with a 1.5% average and 76% positive rate in the month before.

Bigger gains have historically shown up later: a 6% average gain three months after a midterm and a 10% average increase six months after, positive 76% and 87% of the time over those windows.

Across all 38 midterms since 1874, the S&P 500 has gained an average of 14% in the 12 months after Election Day and finished higher 84% of the time, according to Motley Fool analysis of Robert Shiller's stock market data set.

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Data source: Robert Shiller stock market data set, Yale University. Total return (price plus dividends reinvested), not adjusted for inflation.
Year	President	3-Month Return	6-Month Return	12-Month Return
1874	Ulysses S. Grant	0.9%	1.3%	2.6%
1878	Rutherford B. Hayes	8.3%	16.4%	49.0%
1882	Chester A. Arthur	-0.9%	2.1%	-0.5%
1886	Grover Cleveland	-3.4%	3.9%	-4.5%
1890	Benjamin Harrison	5.2%	7.5%	16.5%
1894	Grover Cleveland	-2.3%	8.8%	10.6%
1898	William McKinley	19.6%	18.7%	25.5%
1902	Theodore Roosevelt	3.1%	-5.8%	-20.1%
1906	Theodore Roosevelt	-5.8%	-16.5%	-33.7%
1910	William Howard Taft	2.6%	4.4%	2.5%
1914	Woodrow Wilson	-2.5%	6.4%	29.8%
1918	Woodrow Wilson	-0.5%	15.2%	21.5%
1922	Warren G. Harding	7.0%	1.4%	-0.2%
1926	Calvin Coolidge	4.9%	14.3%	35.8%
1930	Herbert Hoover	5.0%	-11.2%	-33.3%
1934	Franklin D. Roosevelt	-1.2%	8.6%	48.1%
1938	Franklin D. Roosevelt	-4.2%	-12.2%	1.4%
1942	Franklin D. Roosevelt	14.5%	29.0%	26.1%
1946	Harry S. Truman	8.8%	0.0%	9.2%
1950	Harry S. Truman	12.9%	14.6%	22.7%
1954	Dwight D. Eisenhower	11.2%	14.9%	39.9%
1958	Dwight D. Eisenhower	5.2%	12.2%	12.5%
1962	John F. Kennedy	10.7%	18.7%	24.9%
1966	Lyndon B. Johnson	8.8%	16.2%	18.1%
1970	Richard Nixon	16.2%	22.5%	13.6%
1974	Gerald Ford	13.0%	28.5%	31.2%
1978	Jimmy Carter	5.1%	8.1%	15.3%
1982	Ronald Reagan	7.6%	21.6%	25.0%
1986	Ronald Reagan	15.5%	19.7%	3.0%
1990	George H.W. Bush	15.9%	21.9%	26.5%
1994	Bill Clinton	5.3%	15.2%	32.5%
1998	Bill Clinton	9.3%	17.1%	23.1%
2002	George W. Bush	-7.6%	3.8%	17.4%
2006	George W. Bush	4.5%	9.8%	7.3%
2010	Barack Obama	10.7%	12.6%	4.3%
2014	Barack Obama	2.3%	4.3%	3.8%
2018	Donald Trump	1.7%	5.9%	16.3%
2022	Joe Biden	4.6%	6.7%	15.7%

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Best markets in the 12 months after a midterm election since 1874

Data source: Robert Shiller stock market data set, Yale University.
Year	President	12-Month Return
1878	Rutherford B. Hayes	+49%
1934	Franklin D. Roosevelt	+48%
1954	Dwight D. Eisenhower	+40%

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The market has risen sharply in the 12 months after a midterm election in a few standout cases, with little to no bearing on the election results themselves.

The 1878 rally followed the recovery from the Panic of 1873.
The 1934 rally followed the Great Depression's 1932-33 market bottom.
The 1954 gain rode the postwar expansion that followed the Korean War.

Worst markets in the 12 months after a midterm election since 1874

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Data source: Robert Shiller stock market data set, Yale University.
Year	President	12-Month Return
1906	Theodore Roosevelt	-34%
1930	Herbert Hoover	-33%
1902	Theodore Roosevelt	-20%

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Similarly, the market has dropped sharply after a handful of midterm elections, again tied more to historical circumstances than to the election outcomes themselves.

The 1906 decline came just before the Panic of 1907.
The 1930 decline landed in the early years of the Great Depression.
The 1902 decline coincided with a broader economic slowdown.

Swings like these are a reminder that bull and bear markets show up on their own schedule, midterms or not.

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Stock market returns under unified and divided government, by party

Which party runs Washington afterward and how the branches of government are divided have influenced stock market returns in the 12 months following a midterm election, though not in a straightforward way.

Divided government, where the House, the Senate, or both are controlled by a party other than the president's, has averaged stronger returns than unified government, where one party controls both legislative chambers and the White House.

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Data source: Motley Fool analysis of the Robert Shiller stock market data set, official U.S. House of Representatives election results, and U.S. Senate Historical Office Party Division records.
Configuration	Average 12-Month Return	Positive Share of the Time	Election results
Unified government (either party)	12%	73%	15
Divided government (either party)	16%	91%	23

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Splitting unified and divided government by party changes the picture.

Data source: Motley Fool analysis of the Robert Shiller stock market data set, official U.S. House of Representatives election results, and U.S. Senate Historical Office Party Division records.
Configuration	Average 12-Month Return	Positive Share of the Time	Election results
Unified Democratic government	23%	100%	8
Divided government under a Democratic president	13%	89%	9
Unified Republican government	-1%	43%	7
Divided government under a Republican president	18%	93%	14

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A unified Democratic government has had the strongest average return of the four groups, though it is based on just eight midterm elections, spanning the Wilson to Carter administrations.

Divided government under a Democratic president has resulted from nine midterm elections dating back to the 1880s, and the market has been positive in the 12 months following eight of them.

Divided government under a Republican president followed 14 midterm elections -- the most of the four outcomes -- and the market was positive 93% of the time in the 12 months after those contests.

Unified Republican government is the one arrangement that averaged a negative return in the 12 months after a midterm election. The sample is the smallest, however, and three of the seven years immediately after a midterm election resulting in that arrangement, including 1902, 1906, and 1930, were the lead-up to financial panics that had little to do with which party held Congress.

Stock market returns by the size of the president's party's congressional losses

How many seats the president's party loses in the House or Senate in a midterm election has shown little relationship to market movements afterward.

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Data source: Motley Fool analysis of the Robert Shiller stock market data set and official U.S. House of Representatives election results.
House Seat Change	Average 12-Month Return	Positive Share of the Time	Sample Size
Lost 40 or more seats	11%	88%	16
Lost 1 to 39 seats	16%	83%	18
Gained seats	17%	75%	4

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Data source: Motley Fool analysis of the Robert Shiller stock market data set and U.S. Senate Historical Office Party Division records.
Senate Seat Change	Average 12-Month Return	Positive Share of the Time	Sample Size
Lost 5 or more seats	12%	88%	16
Lost 1 to 4 seats	20%	100%	8
Gained or held seats	13%	71%	14

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In both chambers, a landslide loss has not been followed by weaker returns than a narrow one in the twelve months after the midterm. The relationship between seat losses and next-year returns is weak in the House, and about as weak in the Senate.

Historically, voters who banked on significant political change to improve their investment returns may have been disappointed.

How should investors think about midterm elections and the stock market?

Since 1874, the S&P 500 has tended to rise in the year after a midterm election more than its average annual return, and that has held up regardless of which party won, how many seats changed hands, or who ended up in charge of Washington afterward.

That should provide comfort to investors. While midterm elections make political headlines and their outcomes can generate angst and uncertainty, the data show they generally do not cause wild market swings once the dust has settled.

Investors deciding what to do with that pattern can look past attention-grabbing political news and feel confident researching stocks to buy and hold for the long run.

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FAQs

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About the Author

Jack Caporal is the Research Director for The Motley Fool and Motley Fool Money. Jack leads efforts to identify and analyze trends shaping investing and personal financial decisions across the United States. His research has appeared in thousands of media outlets including Harvard Business Review, The New York Times, Bloomberg, and CNBC, and has been cited in congressional testimony. He previously covered business and economic trends as a reporter and policy analyst in Washington, D.C. He serves as Chair of the Trade Policy Committee at the World Trade Center in Denver, Colorado. He holds a B.A. degree in International Relations with a concentration in International Economics from Michigan State University.

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Election Year Stock Market History: What the S&P 500 Has Done After Every Midterm Since 1874

S&P 500 returns before and after every midterm since 1874, by party control and seat losses.

Key Points

Midterm-year stock market history vs. the long-run average

Stock market returns before the midterm elections

Stock market returns after midterm elections

Best markets in the 12 months after a midterm election since 1874

Worst markets in the 12 months after a midterm election since 1874

Stock market returns under unified and divided government, by party

FAQs

About the Author

Read Next

Premium Investing Services

Midterm-year stock market history vs. the long-run average

Stock market returns before the midterm elections

Stock market returns after midterm elections

Worst markets in the 12 months after a midterm election since 1874

Stock market returns under unified and divided government, by party

Election Year Stock Market History: What the S&P 500 Has Done After Every Midterm Since 1874

S&P 500 returns before and after every midterm since 1874, by party control and seat losses.

Key Points

Midterm-year stock market history vs. the long-run average

Stock market returns before the midterm elections

Stock market returns after midterm elections

Best markets in the 12 months after a midterm election since 1874

Worst markets in the 12 months after a midterm election since 1874

Stock market returns under unified and divided government, by party

FAQs

Does the stock market always rise after a midterm election?

What is the average S&P 500 return in the year after a midterm election?

Does the stock market drop before a midterm election?

Does which party controls Congress after a midterm effect the stock market?

Do landslide midterm elections hurt stock returns more than close ones?

Methodology

About the Author

Read Next

Premium Investing Services

Midterm-year stock market history vs. the long-run average

Stock market returns before the midterm elections

Stock market returns after midterm elections

Worst markets in the 12 months after a midterm election since 1874

Stock market returns under unified and divided government, by party

Does the stock market always rise after a midterm election?

What is the average S&P 500 return in the year after a midterm election?

Does the stock market drop before a midterm election?

Does which party controls Congress after a midterm effect the stock market?

Do landslide midterm elections hurt stock returns more than close ones?

Methodology