We are finally here. After months of campaigning, bitter back and forth, and a debate for the ages, today the American people will choose between Republican incumbent Donald Trump and Democratic nominee Joe Biden.
The polls looked grim for Donald Trump nationally and in battleground states for most of October. However, over the weekend, Trump has held rally after rally in key states, and according to some recent polls, he has managed to narrow the gap. There is still a chance that Trump can repeat his stunning result from 2016. Today, I want to focus on three TSX stocks that investors should keep an eye on after the U.S. election.
The U.S. election holds little hope on the presidential side of things…
Neither candidate has bothered to stake a meaningful position on cannabis. Historically, Joe Biden has been anti-cannabis. However, his platform has indicated that his administration may be moved to a more liberal outlook on recreational use on the state and perhaps even federal level. Donald Trump is content to continue to punt the issue to individual states. Because of this, the results of the U.S. election may not offer any aid for struggling weed stocks.
Canopy Growth (TSX:WEED)(NYSE:CGC) is one of the top cannabis producers in Canada. It is fighting towards profitability in what has become a somewhat muddled domestic market. Canada has moved from a supply shortage to a glut. The arrival of recreational edibles has done little to light a fire under Canopy Growth and its peers.
Shares of Canopy Growth have climbed 48% month over month as of close on November 2. Although federal legalization in the U.S. remains out of reach, several states are moving forward with votes on recreational legalization. Arizona, Montana, Mississippi, and South Dakota will vote on this topic. This can open the door for Canopy Growth in these areas.
Trump or Biden? Banks should be golden either way
In early October, I’d discussed why a Joe Biden win in the 2020 U.S. election would be good news for Toronto-Dominion Bank (TSX:TD)(NYSE:TD). Its shares have dropped 14% so far this year. Goldman Sachs chief economist Jan Hatzius suggested that a Biden win, combined with big wins for the Democrats in the Senate and a continued majority in the Lower House, would be positive for U.S. finance.
One of the reasons for this is the huge stimulus package that has been left on the table until after the U.S. election. Experts expect the stimulus plan to run upwards of $2 trillion. Once again, top U.S. banks will be able to gorge on a government rescue package. TD Bank boasts a massive U.S. footprint. Indeed, it is one of the largest retail banks south of the border.
Will a U.S. election propel gold to new heights?
This would not be a U.S. election piece if we did not consider the worst-case scenario for investors. That would be a contested election, which could lead to a lengthy and bitter court battle. Moreover, some political analysts are also fearful that social unrest could follow the election.
In such a scenario, investors should look to stash gold stocks. Barrick Gold (TSX:ABX)(NYSE:GOLD) is one of the largest gold producers in the world. Before 2020 began, I’d suggested that investors should bet on the yellow metal. Shares of Barrick Gold have climbed 50% in 2020 as of close on November 2. The stock is up 62% year over year. Moreover, Barrick Gold possesses an attractive price-to-earnings ratio of 10 and a price-to-book value of 2.1.
On the topic of stocks investors should watch after the U.S. election...
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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Ambrose O'Callaghan owns shares of TORONTO-DOMINION BANK.