Political actions, statements or change(such as elections); play a great role in the fluctuation or decline of the price of specific shares on the stock market. The question many may ask is; how do these political events actually affect the prices of shares- what causes this?
Overall, the prices of shares alter due to the demand in the specific shares. If there is no demand for a share(no one is buying these shares), the prices will decrease. A specific political event could lead to investors not having demand in stocks of a specific economy or shares of a specific company. For example, a political statement could affect the operation of a company or an election or change in political system could create an "unstable" scene in the economy, hence overall affecting the price of shares.
During presidential election years overall in the US, the prices on the stock market overall increase by an average of 7.6%. Furthermore, if the incumbent party remains, the average increase is by an average of 15.1%, while if the incumbent party loses, the average increase(decrease) is -4.4%. A decrease occurs as investors are usually "unsure" of how the new incumbment party will handle their affairs(Mahn). Finally, presidential elections and overall political events greatly effect the prices of shares on the stock market.