Election 2020 A StatebyState and HourbyHour Playbook

Election night is just around the corner, and traders across the globe will be anxiously watching as the results are tallied.

As a reminder, the unprecedented share of early and mail-in votes may take longer than usual to tally, so states and media outlets (which prefer 99.5% confidence before officially declaring a winner) may refrain from calling close races on election night itself. Nonetheless, forward-looking traders will be shuffling their positions based on the data we do have, especially if the result is more lopsided than expected and therefore likely to withstand any late-counted ballots or court challenges. In other words, you’ll need to be nimble and focused to take advantage of all the potential trading opportunities offered by this highly anticipated and consequential vote.

Below, we’ve sketched out an hour-by-hour schedule of the key states to watch with potential implications on global markets. This article will serve as the roadmap and “game plan” for our Election Night Live Blog, where myself and the rest of our global analyst team will provide constant updates on the results, market movements, and trading opportunities throughout the night. Our goal is to be the one-stop shop for all of your election night updates, so we hope to see you there starting at 7:00pm ET!

I) The First Wave: 7:00 – 8:00 ET (12:00 – 1:00 GMT)

Polls close at 7:00PM ET in the following states:

• * Georgia *
• Indiana
• Kentucky
• South Carolina
• Virginia
• Vermont

Polls close at 7:30PM ET in the following states:

• * North Carolina *
• Ohio
• West Virginia

In this early window, there are two key swing / potential “tipping point” states to watch: Georgia and North Carolina. According to pollsters, Georgia and North Carolina are essentially dead heats (with a possible lean toward Biden in North Carolina), but they may be essentially “must wins” for Trump. The FiveThirtyEight state-by-state winner tool, which accounts for correlations between different states, shows that Trump’s odds of winning the overall election rise to roughly a one-in-three probability if he’s able to win both of those key Southern states, but drop to < 1% if he loses either of these states. If the early results from these states are pointing to a clear Biden win (in other words, a polling error in favor of Democrats), traders may aggressively put on pro-Biden trades, rather than wait for results from other key swing states like Pennsylvania and Florida.

It will also be worth watching the Senate races in these states, with two of the tightest races in the country in Georgia (including a special election that likely won’t be decided for weeks) and one similarly tight battle in North Carolina; the final Senate race to watch from these states will be Lindsey Graham’s seat in South Carolina, where the prominent Republican has a slight, but not insurmountable, lead over Democratic challenger Jaime Harrison. The Senatorial race results from these early states will go a long way toward determining whether a "Blue Wave” election, where Democrats control the Presidency, Senate, and House of Representatives, remains on the table.

II) The Second Wave, Including the Two Most Important States: 8:00 – 9:00 ET (1:00 – 2:00 GMT)

Polls close at 8:00PM ET in the following states:

• Alabama
• Connecticut
• Delaware
• * Florida *
• Illinois
• Maine
• Maryland
• Massachusetts
• Mississippi
• Missouri
• New Hampshire
• New Jersey
• Oklahoma
• * Pennsylvania *
• Rhode Island
• Tennessee
• Washington, D.C.

Polls close at 8:30PM ET in the following state:

• Arkansas

This hour, we’ll start to see the results from a large swath of the countries east of the Mississippi (though interestingly, not all of the key upper Midwest states that delivered Trump’s surprise election night victory in 2016). While fully 18 states will start tallying their votes in this window, markets will be primarily focused on the two most important states for the entire election, Florida and Pennsylvania. As with the two swing states we mentioned above, these two states are essentially “must wins” for Trump as well, though if he does win one or both of them, his odds improve dramatically. For example, a Trump victory in Pennslyvania would make the incumbent the odds-on favorite to win the entire election (65% according to the FiveThirtyEight state-by-state winner tool). That said, courts have ruled that Pennsylvania must still count ballots received up to three days after election night, so if it’s a tight race as expected, we may not have a definitive answer from the election’s most important state.

When it comes to the Senate, the tightest race to watch through this window will be in Maine, where Republican incumbent Susan Collins polling near even with Democratic challenger Sara Gideon.

III) The Last of the Major Swing States: 9:00 – 10:00 ET (2:00 – 3:00 GMT)

Polls close at 9:00PM ET in the following states:

• * Arizona *
• Colorado
• Kansas
• Louisiana
• * Michigan *
• * Minnesota *
• Nebraska
• New Mexico
• New York
• North Dakota
• South Dakota
• Texas
• * Wisconsin *
• Wyoming

During this window, we’ll start to get the results from the last of the major swing states: Arizona, Michigan, Minnesota, and Wisconsin. As we all remember, Democrats’ “Blue Wall” in the Upper Midwest states like Michigan and Wisconsin crumbled four years ago, delivering the surprise victory to Donald Trump. Based on the polls, the odds of another surprise in these states (as well as neighboring Minnesota) are longer than we saw four years ago, but still in play, and like we saw with Pennsylvania, Trump would be the outright favorite to win re-election if he can capture any of these three states. Meanwhile, Arizona has been trending from red to purple in recent years and is Biden’s best “Plan B” if he loses Pennsylvania; pollsters currently show the former Vice President hanging on to the slimmest of leads in the Grand Canyon State.

As for the Senate, the most notable race to start reporting results in this window will be from Kansas (Marshall vs. Bollier).

IV) The Stragglers…and Tallying Results from Other States: 10:00PM – 2:00AM ET (3:00 – 7:00 GMT)

Polls close at 10:00PM ET in the following states:

• Iowa
• Montana
• Nevada
• Utah

Polls close at 11:00PM ET in the following states:

• California
• Idaho
• Oregon
• Washington

Polls close at 12:00PM ET in the following states:

• Hawaii

Polls close at 1:00AM ET in the following states:

• Alaska

While some of these states may be “in play,” they’re unlikely to be the ones that ultimately decide the election, so traders will likely be more focused on tallying the ongoing results from some of the earlier swing states we highlighted above. It’s during this window that we’ll likely get as-final-as-possible-given-the-large-share-of-early-votes results from other states, so even if major media companies aren’t comfortable enough to call the outcomes by this period, traders will likely settle into their final positions for the night based, at least when it comes to the Presidential race.

That said, there are a trio of key Senate races we’ll be watching in this window, including a dead heat in Iowa (Ernst vs. Greenfield) and slight Republican leads in Montana (Daines vs. Bullock) and Alaska (Sullivan vs. Gross). If the Senate picture is still unclear as the night rolls on, these races may be the ones to tip the scales, so they’ll be worth watching closely.

As you can see, markets will have plenty of information to digest throughout the night (and likely beyond!) – hopefully this hour-by-hour, state-by-state overview of the race will help you focus on the most important races that are likely to drive markets on Election Night.

As a final reminder, we’ll be running our Election Night Live Blog throughout the night to help guide you through the results and market movements – we look forward to seeing you there!