With just over a week to go before the US midterms, investors have started to hoard cash and buy insurance to hedge against a sharp sell-off on Wall Street if the Democrats take control of both houses of Congress.
While the result of the general election – held at the midpoint of a president’s four-year term – is not expected to trigger an immediate market reaction, fund managers are concerned that the November 3 vote could unsettle an already jittery sharemarket as investors weigh the risks of a divided or fragile government and the subsequent shift in policy.
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