What Is This Year's October Surprise?

The November election is now only about a month away. But once the calendar flips to October, political pundits and traders alike will start watching out for the famous October Surprise.

The October Surprise refers to a potential political bombshell that could be dropped in the final few weeks before the election in an attempt to sway the electorate. Here are a few examples of past October Surprises:

  • 2012: Although it was actually released in September, not October, Mother Jones magazine published a secret audio tape of Republican candidate Mitt Romney saying disparaging things about the 47 percent of Americans who do not pay income tax.
  • 2008: Four days prior to the election, the Associated Press published a story about Barack Obamas half-aunt living as an illegal immigrant in Boston.
  • 2004: On October 29, Al Jazeera aired a new tape of Osama bin Laden telling Americans Your security is in your own hands. The tape is believed to have given a last-minute boost to George Bush ahead of the election.

This year, speculation is running wild about what the October Surprise could be. The Washington Post speculates that information released by Russian hackers, possibly including Hillary Clintons controversial deleted emails, could be the big surprise.

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The Wall Street Journal, on the other hand, believes the October surprise could be somewhat unconventional this year. The WSJ is speculating that the U.S. Q3 GDP number could come in at a robust 3.0 percent-plus just two weeks prior to the election. A strong U.S. economy could be good news for Clinton.

As far as investors are concerned, the uncertainty of October has been bad for stocks in recent election years. The S&P 500 has declined in October in each of the past four presidential election years, including a massive 16.6 percent decline in October 2008.

So far this year, the SPDR S&P 500 ETF Trust (NYSE:SPY) is up 5.9 percent.

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