Today is Election Day, the first Tuesday in November, when on a quadrennial basis American voters decide who will lead the country as President. Of course this Election day also includes other races, Senate, House, State Governorships as well as local races and referendums. 

The answers as why a Tuesday and why in November are interesting and also, add perspective to the current "challenges" to both early and mail-in voting.  History.com tells us that in 1845 Congress passed a federal law "designating the first Tuesday following the first Monday in November as Election Day. 

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But, why a Tuesday in November?

The answer stems from the agrarian makeup of 19th-century America. In the 1800s, most citizens worked as farmers and lived far from their polling place. Since people often traveled at least a day to vote, lawmakers needed to allow a two-day window for Election Day. Weekends were impractical, since most people spent Sundays in church, and Wednesday was market day for farmers. 

With this in mind, Tuesday was selected as the first and most convenient day of the week to hold elections. Farm culture also explains why Election Day always falls in November. Spring and early summer elections were thought to interfere with the planting season, and late summer and early fall elections overlapped with the harvest. That left the late fall month of November—after the harvest was complete, but before the arrival of harsh winter weather—as the best choice."

This year's run up to Election Day has certainly been choppy to say the least. After last week's slide down, markets rebounded on Monday with the S&P closing at 3,310, up 1.23%, the Dow closing at 26,925, up 1.6% and the Nasdaq Composite closing at 10,958, up 0.42%. Lower (than previous highs) but higher. Currently US market futures are green and the VIX is down.

TalkMarkets contributor Andrew Hecht is looking past the elections in his TM Editor's Choice, The Best Way To Play A Rebound In Energy And Airline Stocks. Hecht in an in depth piece starts with this:

"The stock market made an impressive comeback in a V-shaped recovery since the March 2020 low. However, energy and airline stocks continue to be the redheaded stepchildren that have underperformed almost all other sectors. The ugliest performance during one period can often lead to the best opportunities. The prolonged crash course for airlines and energy companies could give way to a substantial recovery over the coming years. A reward is always a function of the risk of an investment. Airline and energy-related companies are risky as we move towards the end of 2020, but that could change in 2021 if the threat of the virus recedes and economic conditions improve."

Hecht includes charts and graphs of related ETFs and sector stocks. As he proceeds to detail the current woes of both airline and energy stocks he makes note of the recent jitters surrounding tech stocks.

"Locating value in the stock market is no easy task these days. The most popular companies in the technology sector are trading at levels where the air is thin, and the potential for significant corrections has increased with the share prices."

Hecht notes conversely that, "Oil companies and airlines are trading at bargain levels...Companies like ExxonMobil (XOM), Chevron (CVX),  Southwest Airlines (LUV), and Delta Airlines (DAL) are likely to survive the pandemic. While they continue to cut expenses and shrink their workforces, the end of the coronavirus in 2021 would allow them to return to a more normal environment for energy and travel demand. I do not favor an aggressive approach to buying shares of these companies at their current prices. I would be a scaled-down buyer, leaving plenty of room to add on the downside when it comes to the four companies and the Energy Select Sector SPDR Fund (XLE) and  US Global Jets (JETS) ETF products, which diversify risk. The two ETFs have substantial exposure to the four companies."

Leaving readers with something to think about Hecht concludes: "Airline and energy companies have been on the same crash course in 2020. The end of the pandemic could allow for a smooth landing and a period where they catch up with the rest of the market that has left them in the dust."

Sheraz Mian checks out what's behind last week's drop in the S&P 500 (SPY) in his article, Are Technology Companies Losing Their Earnings Power?. A good read, Mian provides detailed Q3 earnings scorecards for the tech stocks now comprising the major portion of the S&P 500 as well as the outlook for future earnings. Below are some of the highlights:

• "The market appears to be reevaluating its position on the big technology stocks, with the trend becoming even clearer after Thursday’s quarterly releases from Apple (AAPL), Amazon (AMZN), Alphabet (GOOGL), and Facebook (FB). The market’s reaction to the Microsoft (MSFT) release a few days earlier is in the same category."
• "Compositional changes (in the S&P 500) show that the Technology sector is by far the biggest contributor of earnings to the S&P 500 index, handily eclipsing the Finance sector, which enjoyed the biggest earnings weightage in the index for many years. Not only is the Technology sector bringing in the most money, it also enjoys the best earnings growth profile."

• "The growth outlook is impressive for the 5 big Tech companies that we started this discussion with – Apple, Microsoft, Alphabet, Amazon and Facebook. The table below shows that combined earnings for these 5 big companies are on track to increase by +7.6% on +12.3% higher revenues this year, followed by +25% earnings growth and +17.2% revenue growth in 2021."

• "I am not making a valuation comment here, just discussing earnings. Valuation is like beauty, it is in the eyes of the beholder. That said, there can be legitimate concerns that valuation for some of these Tech stocks may have gone a bit too far, particularly following the group’s impressive run up this year. More likely, the sell-off in these companies is simply profit taking, with market participants cashing in some of their profitable chips. In other words, there is nothing fundamentally wrong with these stocks. If anything, the long-term outlook for these companies remains extremely favorable."

Has Trump's tariff war with China helped American manufacturing?  Brad Polumbo in Trump’s Trade War Failed To Restore Manufacturing Jobs, New Analysis Shows, looks at the data and the picture is not pretty. Citing new data analysis from the Wall Street Journal Polumbo notes "The tariffs helped some manufacturers by hurting others via raised prices, and (predictably) triggered retaliatory tariffs from China that together outweighed any benefits.The problem with tariffs generally speaking is that they kill more jobs than they create."  The graph below shows the trajectory of US manufacturing jobs since the various Trump tariff actions and counteractions.

The article concludes with the following statistics cited in the WSJ report.

"An industry-by-industry analysis by the Federal Reserve showed that tariffs did help boost employment by 0.3%, in industries exposed to trade with China, by giving protection to some domestic industries to cheaper Chinese imports. These gains were more than offset by higher costs of importing Chinese parts, which cut manufacturing employment by 1.1%. Retaliatory tariffs imposed by China against US exports, the analysis found, reduced US factory jobs by 0.7%."

In a lighter look at the markets and the election Marc Lichtenfeld  writing in The Secret To Keeping Your Cool This Election recalls market disrupting events like, "the Great Depression, World War II, the Cuban missile crisis, the assassinations of President John F. Kennedy and Martin Luther King Jr., civil unrest, Watergate, and the financial crisis." He reminds us that despite it all "the market returns double digits annually over the long term."

Lichtenfeld also includes this personal story, which for some of the younger investors out there, is worth taking note:

Polls and pundits aside, it seems we really don't know yet, who will win the presidential election, Biden or Trump, but as Queen sang, "The Show Must Go On".  To that end we look to Matt Shuler who gives us, 5 Stocks To Own Regardless Of The Election.  Here they are, along with some of his comments:

• The Hershey Company (HSY), $144/share, D.R. Horton (DHI), $71/share, Simon Property Group (SPG), $65/share, JPMorgan Chase & Company (JPM) $101/share, and Allstate Corp (ALL), $91/share 

"These companies are best-in-class in their respective markets, and they share the following:

• Attractive-or-better risk/reward stock rating
• Large cash reserves to survive a prolonged economic downturn
• Superior and/or faster rising return on invested capital (ROIC) compared to peers
• Strong market share and competitive position
• Not dependent, in any meaningful way, on election results

Investors looking for long-term-value-creating stocks leading up to the election should start here."

Shuler's article continues with a detailed profile for each of his picks. It's worthy of a once over.

That's the TalkMarkets contributors’ round-up for Election Day.

Here's an ending quote from retired U.S. Senator Barbara Boxer:

"Every citizen of this country should be guaranteed that their vote matters, that their vote is counted, and that in the voting booth, their vote has a much weight as that of any CEO, any member of Congress, or any President."