November 2026 Market Insight
As we enter November 2026, the midterm elections have predictably taken over the financial news cycle, with pundits treating every ballot count like an existential verdict on the stock market. In reality, Wall Street tends to care far less about political theatre and far more about legislative math, inflation, and corporate cash flow. At LA Wealth Advisors, we prefer to tune out the campaign noise and examine the structural bull and bear cases that actually matter for your long term wealth objectives.
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The Bull Case: A Split Congress Could Spell Big Stock Gains Into 2027
While midterm elections reliably make investors nervous and stir up short term market volatility, historical data shows that stocks tend to stabilize and deliver strong gains once the ballots are counted. A split Congress locks in legislative gridlock, which can dramatically reduce the odds of sweeping tax overhauls or sudden regulatory shocks. With pre election uncertainty out of the way, institutional capital historically moves off the sidelines to fuel a post election rally heading into the new year.
Why It Matters: Wall Street does not cheer for red or blue; it cheers for gridlock. When politicians are too busy arguing with each other to pass new laws, corporate executives can actually plan their capital allocation in peace. Still, a historical relief rally is not an excuse to throw money blindly into top heavy index funds. We continue to focus our equity on clean balance sheets and real cash flow that can potentially thrive regardless of who holds the gavel in Washington.
The Bear Case: Hot Inflation, Drained Savings, and December Rate Hike Risk
Beneath the surface of strong headline GDP growth and a surge in AI business investment, persistent inflation is eroding household purchasing power right as voters head to the polls. With Middle East tensions keeping oil above $100 a barrel and gas averaging $4.23 a gallon, annual PCE inflation accelerated to 3.6 percent while real after tax incomes slipped and the personal savings rate dropped to a four year low of 3.8 percent. Rather than cooling off, sticky price pressures have increased the likelihood that the Federal Reserve will raise interest rates again in December.
Why It Matters: Campaign speeches do not lower the price of diesel or refill a drained savings account. Consumers are raiding their savings just to keep up with 3.6 percent inflation, and the bond market knows that a Warsh led Federal Reserve without forward guidance could easily hike rates in December to put out the fire. This exact dynamic is why we executed our tactical bond portfolio revamp earlier this year. By staying out of long duration debt and passive cash proxies in favor of intermediate credit and short duration high yield instruments, we aim to capture attractive income while shielding your portfolio from the rate volatility that comes with stubborn inflation.
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Strategic Position
Navigating midterm election noise requires separating political emotion from portfolio math. Whether the market leans into the historical bull case of a split Congress or grapples with the bear case of 3.6 percent inflation and December rate hike odds, we believe making reactive bets on ballot outcomes is a losing strategy. We remain dedicated to our structured process, focusing on quality management to keep your financial plan moving steadily toward your Work Optional date.
DISCLOSURES
LA Wealth Advisors, LLC is a dba of Axxcess Wealth Management, LLC (“AWM”)
The views expressed in this commentary are subject to change based on market and other conditions. These documents may contain certain statements that may be deemed forward looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur.
The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.
The information contained above is for illustrative purposes only. Past performance shown is not indicative of future results, which could differ substantially.
