It’ll be all about sequencing for the S&P next year.

That was one message from SocGen’s year-ahead outlook for US equities. “The journey is likely to be fraught with uncertainty, especially around mid-year,” the bank’s Manish Kabra wrote, retaining his 4,750 year-end 2024 target for the world’s benchmark risk asset par excellence.

Note that 4,750 would entail the S&P “flirting” (as one mainstream media outlet put it Monday, editorializing around SocGen’s forecasts) with record highs seen just prior to the onset of the most aggressive Fed hiking campaign in a generation. For reference, Goldman’s 2024 year-end target is 4,700. Morgan Stanley’s is 4,500.

From a sequencing perspective, Kabra sees a decent Q1 for US shares, followed by a rough stretch in Q2. “The S&P should see front-loaded gains as bond yields drop at a time when [our] global cycle indicator continues to rise and the Nasdaq 100 still has easier YoY EPS comps,” he wrote. “The consumer-driven downturn should become visible in Q2 with political uncertainty rising post the primaries.”

Q2, Kabra went on, “is likely to be the most painful period for the S&P due to uncertainty on employment and the elections.”

That wouldn’t be the best news for Joe Biden. In an economics note published Monday, Goldman’s Alec Phillips and Tim Krupa endeavored to determine when economic (and stock) performance has the largest influence on election outcomes. Q2 stood out in their analysis.

Although “some variables are more predictive when measured over a longer horizon, the strongest statistical relationship with the election result is often with variables measured in Q2 of the election year,” Phillips and Krupa wrote.

As the figure shows, GDP and stock prices may hit “peak relevance” (if you will) in Q2 of 2024, just when things could be getting dicey both for the economy and equities.

There’s been quite a bit of digital ink spilled in 2023 on the disparity between Biden’s poll numbers and robust economic growth, rising wages and very low unemployment. There are two standard explanations. One is that polls are meaningless in the era of hyper-partisanship. The other is that people despise inflation with a holy passion, and that disdain overrides all other considerations when it comes to assessing a president’s handling of the economy.

“We’re making considerable progress in bringing inflation down, but Americans do notice higher prices from what they used to be accustomed to,” Janet Yellen told Andrew Ross Sorkin on Monday. “Although prices in general are rising less quickly, Americans still see increases in some important prices, including food.”

But there’s more to it than that. As Michael Podhorzer, former political director of the AFL-CIO, explained last week in an interview with Ezra Klein,

The kinds of things that really matter to working people have gotten a lot worse in terms of how much more precarious their employment is. So if you make, say, 10% or 15% more, but you don’t know what your hours are going to be next week, you don’t know whether you’ll have a job in seven months, you don’t feel like someone telling you you’ve just got a 15% raise is the whole story.

And similarly, if you have a family, if you don’t feel like you’re going to be able to help your kids get a better life, that’s just not going to be overcome by this month’s unemployment numbers. And I think inflation is another area where there’s this kind of data mismatch. Inflation coming down is still rising prices. And if you’re in the bottom 3/4, that’s an immense burden. Unlike a lot of other problems, inflation is one that is in your head all the time. You just spend all this time and mental overhead that’s unlike a more abstract problem.

Of course, inflation could (and, with a little luck, will) moderate significantly further by election day, but the fact that, as Podhorzer put it, “Inflation coming down is still rising prices” is a real liability for Biden. That’ll be compounded if, by election day, growth is decelerating, unemployment is rising and stocks are anything other than buoyant.

Maybe the Fed can help. “Q3 should also see heightened policy uncertainty [but] Fed rate cuts should be more pronounced by then,” SocGen’s Kabra remarked, before cautioning that “tough earnings comps for Nasdaq 100 stocks will mean breadth is needed to take the S&P higher, which we think is more likely in Q4 than Q3.” That’ll be too late for Biden.

But it’s not all bad news for the Biden White House. Low presidential approval ratings are the norm in America not the exception. And, as Podhorzer told Klein, what people say in surveys isn’t necessarily indicative of how they’re going to vote.

“When [voters] answer a survey, it’s an opportunity to express their frustration, their disappointment,” Podhorzer said. “But then when they actually have to go and vote and actually look at the choice, it doesn’t match — people can distinguish what’s at stake when they’re actually deciding who they want.”