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CNBC’s Jim Cramer said President Donald Trump’s Thursday morning tweet that suggested delaying the November election could cause problems for equity investors.
“It sows chaos, and chaos is bad for the stock market,” Cramer said on “Squawk on the Street.”
Dow futures extended their fall slightly in the wake of Trump’s tweet. They then made back some of the decline.
Trump does not have the power to delay the election by himself; presidential elections are set as the first Tuesday of November by a 19th-century law from Congress.
Nonetheless, Trump suggested that delaying the election may be necessary because of the threat of the coronavirus pandemic.
Trump claimed that an increased reliance on mail-in voting would result in a fraudulent election — however, there is scant evidence to support the claim that mail-in voting would lead to widespread voter fraud. Twitter in May fact-checked two of Trump’s tweets that made a similar claim about mail-in voting.
In addition to the progress of the U.S. coronavirus outbreak, Wall Street also is focusing on the presidential election and its implications for economic policy.
Earlier this month, Goldman Sachs warned its clients that the election results could be delayed due to a larger share of the electorate opting for mail-in ballots, which can take longer to process. As a result, the investment bank advised clients to hedge their market exposures into December in expectation of increased volatility lasting through November. The election is set for Nov. 3.
Presumptive Democratic nominee Joe Biden leads Trump in an average of national general election polls, 50.1% to 41.7%, according to Real Clear Politics.
