Voters walk to cast their ballots during early voting for the presidential election at a polling place at the C. Blythe Andrews, Jr. Public Library in Tampa, Florida, the United States, on November 1, 2024.
Octavio Jones | Reuters
Executives at America’s largest companies are speaking out with investors about the presidential election more than in recent cycles.
The word “election” appears on 100 earnings calls S&P 500 Index– Companies that went public between Sept. 15 and Oct. 31, according to FactSet. That’s the highest number of companies mentioning the word on the broad index in that time frame, according to CNBC’s Screen Show from the same period in 2004. US presidential election It’s Tuesday, November 5th.
As Kamala Harris and Donald Trump go to the polls, average Americans are focused on the economy. Meanwhile, white-collar leaders are considering the potential impact of policies on their businesses while lamenting the general sense of instability that the political season brings.
“You might be feeling a little cautious because of the uncertainty about the election and various other factors,” Dover CEO Richard Tobin tell analysts during the specialty manufacturer’s earnings call in late October.
FactSet senior earnings analyst John Butters first noted the number of companies discussing the election in recent weeks. Notably, his data found that executives at S&P 500 companies rarely mentioned Harris or Trump by name when talking about the campaign more broadly.
“cautious” customer
Several companies said consumers and business clients are experiencing a sense of unpredictability about the presidential race.
exist tractor supplyChief executive Harry Lawton said it expected its customers to remain “cautious” as they have been in past election years. The move comes after the farm-focused retailer reported an increase in emergency response sales to start the quarter following Hurricanes Helen and Milton.
Southwest AirlinesMeanwhile, a “trough” in air travel is expected around Election Day, according to operations director Andrew Watterson. But when it comes to booking trends, royal caribbean CEO Michael Bailey said that historically, presidential elections do not have a long-term impact, although cruise lines may see some volatility during the week of the election.
Southwest Airlines aircraft receive service at the gate at Hollywood International Airport in Fort Lauderdale, Florida, on May 18, 2024.
Gary Hershorn | Corbes News | Getty Images
In addition to Election Day, market participants and business leaders are also paying close attention to the Federal Reserve’s monetary policy meeting next week. tool maker Stanley Black & Decker Chief executive Donald Allan cited the election and interest rates as reasons for expected “market volatility” in the first half of 2025.
As of Friday evening, CME Group’s FedWatch tool showed there was about a 96% chance that borrowing costs would fall at the November meeting when federal funds futures are priced in. Previously, the central bank issued in September First interest rate cut since 2020.
Stanley Black & Decker’s Allen also noted Trump’s Import tax policypointing out that the United States “may adopt a new tariff system.” Republican candidate says he plans to levy 20% tax For imported products, a super high tax rate of 60% is levied on products from China.
William Grogan, Chief Financial Officer, Water Infrastructure Corporation xylemsaid the election was one of the factors that put a “little pause” on large-scale projects in the industrial market. republic service CEO Jon Vander Ark said the waste company will see “some paralysis in an election year,” but he was optimistic about late 2024 and early 2025.
Pay attention to the economy
More broadly, Eric Ashleman, CEO indexThe company, which makes components ranging from airbags to DNA testing equipment, said the race has not helped the recent economic situation.
Nonfarm employment growth Minimum number of jobs October is back to the end of 2020 due to hurricanes and the Boeing strike. In this spirit, Exfax said background check volume has softened as executives consider what the results mean for their businesses.
“Coming into the election, companies appear to be more cautious about new hiring,” said Equifax CEO Mark Begor.
To be sure, some of the “elections” mentioned this year relate to unrelated events like the health care enrollment period. Other companies include software companies Taylor Technologies To the credit card giant American Express said they were not feeling the impact of the election on their business.
“This company has been around a long time,” American Express CEO Stephen Squery told analysts last month. “I mean, obviously, 174 years ago we didn’t have a card. But we’ve been there. Many different elections; many different configurations of House, Senate, etc.”
equity housing Meanwhile, CEO Mark Parrell said state and local governments are more important to businesses than which side wins. The company is an apartment-focused real estate investment trust.
go ahead
Still, this cycle appears to have attracted an unprecedented number of leaders from America’s largest businesses. The number of mentions in 2024 equates to about one in five companies in the S&P 500 mentioning the word “election” during that time period. This is more than three times the number of mentions during the same period in 2008.
Dr. Horton Buyers ‘remaining on the sidelines’ amid expectations of lower prices mortgage interest rate CEO Paul Romanowski said elections will bring pressure in 2025. The homebuilder is trying to stimulate demand by offering mortgage purchases and focusing on building smaller homes, he said.
Another member of Dr. Horton’s top management was more forthright about the election.
“I think everyone will be happy that the election is over,” Chief Operating Officer Michael Murray told analysts on the company’s earnings call. “I think it will help with buyers’ mood and ability to make life decisions.”
