Jeremy Siegel: Don't Expect That Post-Midterm Stock Bounce

Wharton School finance professor Jeremy Siegel warns the stock market may not see its typical post-midterm surge next year.

"There's a lot more uncertainties that will make next year not ... a stellar year we usually get in third-year presidential cycles," Siegel told CNBC.

He blames worries about the Fed's path higher for interest rates and the possibility of Democrats taking control of the House in Tuesday's election.

To be sure, Newsmax Finance Insider Stephen McBride recently unveiled a shocking discovery.

"For each of the past 18 midterms, stocks have always climbed higher a year later. Always," McBride wrote for Newsmax Finance.

"We’ve had every possible political combination in the past 72 years. Republican president with Democratic Congress. Democratic president with Republican Congress. Republican president and Congress. Democratic president and Congress," McBride explained.

"The market climbed higher every time."

To be sure, U.S. stocks rose on Tuesday, as strong earnings and easing of trade tensions lifted materials and industrial sectors, but trading volumes were light as uncertainty about the outcome of U.S. midterm elections kept investors on the sidelines, Reuters reported.

Financial markets are bracing for President Donald Trump’s Republican party losing control of the House of Representatives, while retaining the Senate.

A political gridlock between the White House and Congress could hinder Trump’s pro-business agenda and raise concerns about political instability, but most analysts say this may not be the worst outcome for the stock market.

Many fear that there could be a sharp selloff in the market if the Democrats sweep both the House and the Senate. In contrast, stocks may rally on hopes of more tax cuts if Republicans retain control of the House.

However, some respected economic gurus do have predictions of how the market will react.

Billionaire Thomas Peterffy predicts that the stock market will plunge up to 15 percent should Democrats take the House and Senate in the midterm elections.

The founder and chairman of Interactive Brokers, one of the nation’s leading digital brokers, says the market will surge back to record highs if Republicans retain control and ward off a Blue Wave on Tuesday.

“If the Republicans win, the market is not going go down. The market is going to go up,” he told Newsmax TV in an exclusive interview.