The long anticipated day is finally here as Hillary Clinton and Donald Trump square off tonight in the first of three Presidential debates.  For both, the stakes really couldn’t be higher, and each is preparing in their own way.  According to campaign reports, Clinton was holed up this weekend brushing up on policy and watching tape of Trump’s prior debates and speeches.  Trump, for his part, spent part fo the weekend eating cheesesteaks.   The importance of Monday’s debate can’t be overstated, especially after the last two weeks where Donald Trump has seen a surge in his poll numbers and odds following Clinton’s health scare at the 9/11 memorial service earlier this month.  A strong performance by Clinton tonight could instantly put a stop to Trump’s momentum and put her back in the driver’s seat.  Meanwhile, any misstep on her part or a strong performance from Trump could really spell trouble for a campaign that up until this point has not been behind.

The first chart below shows the odds for the Democratic candidate to win in November compared to the S&P 500.  For the entire year, the contract for the Democratic candidate has been above 50% and even exceeded 75% following the Democratic convention in August.  However, late August and early September were good for “the Donald” as Clinton’s odds have now declined down to 61.9%.  What is interesting to note about this chart is that while the S&P 500 closely tracked Clinton’s odds for much of 2016, since July they have really stopped tracking each other.  When her odds declined in July, the S&P 500 actually rallied.  More recently, as Clinton’s odds have sunk to new lows, the S&P 500 has, for the most part, held up.

democratic-betfair092616

For Trump, it’s the opposite (obviously).  For much of the year, the S&P 500 and Trump generally moved in opposite directions, but more recently the two have started to move independently of each other.  In terms of Trump’s current odds, we have seen a major shift.  After several attempts of trying and failing to get above 30% earlier this year, Clinton’s troubles have pushed Trump up to new highs at 35.8%.  While Trump’s odds are at new highs, we would once again stress that at 35.8% Trump is still a big underdog.  However, he has moved into a position where a strong debate showing tonight could really turn this into a serious race.

trumpbetfair092616

 

Print Friendly, PDF & Email