State of election markets: 289 Days

With the Iowa Caucuses fast approaching we saw a lot of movement this week on the Republican side. First, Donald Trump is starting to pull away from his primary rival Ted Cruz in the race for the non-establishment vote. Second, Marco Rubio had has his first good week in a while in his race to control the establishment vote. On the Democratic side, not much movement, but the race is really starting to feel like an election for the first time.

The market have been very clear on Trump pulling away from Cruz since late December and this last week is a further consolidation of his gains. After briefly falling behind in the polling, Trump is now winning in the polling in Iowa, and maintains his leads in New Hampshire and South Carolina. If he wins all three Cruz is done and Trump wins the non-establishment semi-finals for the GOP nomination.

On the establishment semi-final side Marco Rubio had a good week. He got the endorsement of the Des Moines Register and looks poised to take third in Iowa. And, despite up and down polling, the data still points to him taking second in New Hampshire. If Trump wins Iowa he is almost certain to take New Hampshire and South Carolina. The pressure will be on the GOP establishment to drop John Kasich, Jeb Bush, and Chris Christie. A Trump win in Iowa helps Rubio in New Hampshire.

PredictWise20160124r

Vertical Lines: No major events this week.
Sources: Betfair, Hypermind, PredictIt, http://twopointoh.predictwise.com/politics/2016-president-republican-nomination/

A few squabbles on the Democratic side make it feel like an election. But, Clinton is still in the drivers seat against Bernie Sanders. The threat of electablity questions around Sanders and Michael Bloomberg will help consolidate support for Clinton. A win in Iowa will offset any loss in New Hampshire. Especially with a very likely win in South Carolina.

PredictWise20160124d

Vertical Lines: No major events this week.
Sources: Betfair, Hypermind, PredictIt, http://twopointoh.predictwise.com/politics/2016-president-democratic-nomination/.