The stock market's 150-year record says midterm years reward patient Americans — and while voters here prepare to render their verdict, Palestinian Authority President Mahmoud Abbas just canceled an election he couldn't win.
Roughly 150 million Americans own stock, and the S&P 500 has climbed in the year following 32 of the last 38 midterm elections, averaging 14% gains, according to a Motley Fool analysis of data going back to 1874. Neither which party takes Congress nor how many seats the president's party loses has been closely tied to those returns. But the vote still happens. In Ramallah, it won't.
Abbas issued a decree Friday pushing Palestinian legislative elections to September 2027 — nearly another full year of delay, according to WAFA, the official Palestinian news agency. Presidential elections, untouched for over two decades, were pushed to the same date. Palestinians haven't held a legislative vote since 2006, when Hamas won a majority of seats.
The PLO's Executive Committee, which Abbas heads, claimed conditions in East Jerusalem, the West Bank, and Gaza were not "conducive" to holding elections, citing Israel's refusal to allow election materials or international observers into Gaza. The real reason was plainer. An unlikely alliance had formed between Hamas, Islamic Jihad, and a bloc led by former Fatah security chief Mohammed Dahlan — driven from Gaza by Hamas and exiled in 2010 after a falling-out with Abbas.
"Abbas is terrified by the electoral alliance bringing our faction together with opposition factions and forces within Fatah that reject his leadership," Dimitri Dilliani, a spokesperson for Dahlan's faction, said in a statement.
CBS News reported the postponement threatens to further erode the Palestinian Authority's credibility among ordinary Palestinians and the donor countries that fund it. The Authority, dominated by Abbas's Fatah party, has administered semiautonomous parts of the Israeli-occupied West Bank since the 1990s and grown increasingly unpopular, with many Palestinians viewing it as corrupt and criticizing its security cooperation with Israel.
Back home, the market data tells a different story about what follows accountability. The S&P 500 averages 4% gains in the six months before midterms and 1.5% in the month prior, but the real moves come after the verdict: 6% gains three months out, 10% six months out, finishing higher 87% of the time over that window.
The worst post-midterm markets — 1902, 1906, 1930 — coincided with panics and depressions, not election outcomes. The best — 1878, 1934, 1954 — followed recoveries. Fundamentals beat partisan control every time.
The midterms will render a verdict on whether Americans are better off than two years ago. The market says growth follows regardless of who wins. In Ramallah, there is no verdict — just another decree from a man who has held power for two decades. That's the difference a ballot box makes.
