It is finally election day
It was all about the final polls yesterday, but today the focus will shift towards the exit polls and reports/rumours involving sentiment on the ground - especially in the six key swing states i.e. Florida, Pennsylvania, Arizona, North Carolina, Michigan, and Wisconsin.
The final polls yesterday still suggest that Biden has a lead in these states but they have considerably narrowed over the past two weeks, with some sense that Trump could pip it in the end as the numbers start to get within the polling margin for error.
It is going to be a long night and a tightly contested race over the next 24-36 hours could start to bring in focus to mail-in ballots, which may take days to settle.
As mentioned yesterday, Florida, Arizona and North Carolina are the likely swing states to report a projected winner earlier than the others - barring a really close count that is - since they have prepared to count the mail-in ballots.
The final polls for Florida and North Carolina especially are showing a narrowing margin in favour of Biden, so these will be two key states to watch if there are any early results to be declared later in the night.
Trump needs both of these states or a combination of Florida and Arizona/Pennsylvania at least to stand a chance of winning in the end.
In North Carolina, a tightly contested race may take several days to settle as mail-in ballots marked for election day will be counted all the way through to 12 November.
I still maintain that the "base case" scenario that the market is looking at is for a 'blue wave', though I would argue that investors are underpricing the risks associated with the outcome once you look past the stimulus narrative.
That said, I'm less confident of that outcome as I was at the start of the month and it is pretty much coming down to a 60-40 or 55-45 kind of feeling at this stage.
But we'll see how things play out at the end of the day. Either way, strap yourselves in. It is going to be a long night, folks. Here's some catch-up over the past few days:
- The US election is going to act as a stimulus vote for the market
- Pelosi hints at roadblocks to Biden's plan to raise corporate taxes
- A Trump win this time would be a far bigger upset
- What's the trade if Trump steals the election this year?
- A look back at what happened in markets the last time there was a disputed election
- What time was the US election called in each vote this century
- What is the key risk for the market ahead of the US election tomorrow?
- Trump plans to declare victory if he's ahead on Tuesday night - report
- Biden has a narrow lead in Florida in Reuters/Ipsos polls of battleground states
- Final CNBC polls in six key states to win
- WSJ reports the US election "is tightening in 12 battleground states"
