US Elections: It’s all about presidential candidate debates and voter sentiment - HSBC

Research Team at HSBC, suggests that the first of three US presidential candidate debates will take place today which will consist of six 15-minute segments in which the major party candidates, Hillary Clinton and Donald Trump, will discuss three topics: America’s Direction, Achieving Prosperity, and Securing America.

Key Quotes

“The candidates will make opening statements, then respond to each other’s statement, and then respond to questions put to them by a moderator.

An important question is whether or not these debates influence voter sentiment, especially in a time when partisan polarization appears to be quite high among the American electorate. If people are strongly opposed to the other party’s candidate, they may not change their minds about who they will vote for no matter who “wins” or “loses” the debate. However, if there is a group of potential swing voters who might change their minds on the basis of the debate, then the debates could affect the outcome of the election.

Interpretation of the change in polling averages after the debates makes it seem that the debates will be quite important in determining the outcome of this year’s election. While the evidence from the last presidential election is interesting, this election has the potential to be different. There appear to be a greater number of undecided voters at this stage of the campaign than there were in 2012. So there may be a larger number of potential voters who, having yet to make up their minds, will be swayed by the results of the debates.

Whether or not the debates will have a real impact on the election outcome, the debates could have an effect on polling results and on the media’s perceptions of which candidate “won” or “lost.” That, in turn, could influence voter sentiment and so alter investor valuations of different assets for which prices might be affected by the outcome of the election. If nothing else, the debates have the potential to boost market volatility in coming weeks.”