If the US Presidential election were held today, President Obama would have a 61% chance to win reelection, according to the Hedgeye Election Indicator (HEI). That's down a full percentage point from last week, when the HEI calculated the President's chances of winning reelection at 62%. It's also the second consecutive week that the HEI has shown that the President's odds of reelection have declined. The decline in the last two weeks stands in contrast to the first quarter of the year when the HEI climbed in January from a 50% likelihood that Obama would win reelection to a record high of 62.3% in late March.
Hedgeye developed the HEI to understand the relationship between key market and economic data and the US Presidential Election. After rigorous back testing, Hedgeye has determined that there are a short list of real time market-based indicators, that move ahead of President Obama’s position in conventional polls or other measures of sentiment. One of those indicators, the timing of the overall performance of the US stock market, played a key role in moving the HEI lower this week. Based on our analysis, market prices will adjust in real-time ahead of economic conditions, which will ultimately shape voters’ perception of the Obama Presidency, the Republican candidates and influence the probability of an Obama reelection.
Hedgeye releases the HEI every Tuesday at 7 a.m. ET, all the way until election day Tuesday November 6.