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U.S. Debt Ceiling Changes and the U.S. Stock Market

Steve LeCompte | | Posted in: Economic Indicators, Political Indicators

How does the U.S. stock market typically react to U.S. debt ceiling discussions/actions? To investigate, we look at cumulative S&P 500 Index returns around actions to change the debt ceiling. Using daily S&P 500 Index returns and debt ceiling action dates during mid-June 1940 through May 2023 (90 quantitative actions), we find that:

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