Stocks will climb no matter who wins the presidential election — and could surge 19% in one scenario, JPMorgan says

• The upcoming US election is a catalyst for positive action in stocks, according to JPMorgan's Marko Kolanovic, as it will remove a key overhang from the markets.
• No matter who wins the presidential election, expect the market to move higher, even in the scenario of a blue wave sweep.
• And in the scenario that President Trump wins reelection in a "status quo" win, the S&P 500 could surge 19% to 4,000, Kolanovic said.
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While many market participants view that a Biden win, or a "blue sweep" in the upcoming Presidential Election, would be a negative for stocks and put pressure on the market, JPMorgan's Marko Kolanovic isn't so sure.

In a note on Thursday, Kolanovic said that no matter the outcome of the November election, its resolution will be a positive market catalyst. The conclusion of the election will remove a significant uncertainty risk currently hanging over the mind of investors.

In all three scenarios, stocks will move higher, according to Kolanovic.

If Joe Biden wins the election in a blue wave that sees the Senate flip to the Democrats, "markets should move higher," Kolanovic said.

The stock market should move even high if Biden wins the election but Congress is split, as it would be difficult for Biden to pass his proposed tax reform policies. In this scenario, the S&P 500 could surge to 3,600, representing potential upside of 7% from Thursday's close.

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Stocks move the highest, according to Kolanovic, if President Trump wins reelection in a status quo scenario. A Trump win could see the S&P 500 surge to 4,000, representing potential upside of 19% from Thursday's close. On top of that, Kolanovic sees potential for the market to overshoot the 4,000 price target.

Still, tail risks scenarios always exist and uncontrolled developments post-election could cause stocks to move lower, Kolanovic noted. Investors should hedge their stock exposure with S&P 500 puts, a form of insurance that will help stem any significant downside moves in the market, Kolanovic added.