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Stocks: Bracing for a rocky October

October 03, 2010

Brian Battle, Director at Performance Trust Capital Partners, discusses what the month of October may look like for investors.

Midterm elections: The stomach churning ahead of the midterm elections -- which could bring with it new regulation and tax policies -- is likely to keep investors from jumping in, said Brian Battle.

"Everyone takes their bets off the table before an election because of three levels of uncertainty," said Battle. "The first unknown is if conservatives re-take the House or Senate, the second is if they do, what their policies are going to be and whether they get them voted on, and the last thing is whether Obama vetoes it."
Earnings: The uncertain political climate is also causing businesses to exercise caution, said Battle.

"If Republicans do take the House, that will be good for companies and good for the markets because it will be a very pro-business environment," said Battle. "But until we have that clarity, it's really tough for corporations to make business decisions and project future earnings without knowing what tax policies and regulation will look like."

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