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As polls tighten, the U.S. election may start to sway the markets.

The “dog days” of summer have shown their teeth. Last week we saw some action on the S&P 500 at last. But this doesn’t feel like a real correction.

It’s worth remembering that not even a surprise like Brexit could knock equity markets off course. What set off last week’s wobble? Dovish Boston Fed Chair Eric Rosengren telling us there was a “reasonable case” for a rate hike and that ducking it could delay the economic recovery. Theories circulated that Fed board member Lael Brainard, another dove scheduled to speak three days later, was there to soften us up for a hike this Wednesday.

The Fed False Alarm

In her remarks, Brainard stayed with her dovish instincts. Fed Funds futures went from pricing in a 24% probability of a September hike to 15%—lower than before Rosengren spoke. The S&P 500 bounced 1.5%, led by the high-yielding stocks that had sold off in response to Rosengren.

I’m no professional Fed watcher, but I’ll stick my neck out and predict that Janet Yellen will hold again on Wednesday.

And so then we’ll turn to the Q3 earnings season. Current expectations are for a flat quarter. To meet expectations for 2016 earnings, that implies a pop up to high single-digit growth in Q4, and given recent weakness in economic data, that seems very optimistic. But if markets stay true to recent form they will likely worry about that in December.

Before December, we have the small matter of a U.S. presidential election. With Labor Day behind us, the campaign is beginning to impinge on the market’s consciousness just as it is on the minds of voters at large.

Election Polls Are Tightening

We can see that in recent opinion polls. A month ago, the New York Times analysis of state and national polls put the probability of Hillary Clinton winning the White House at 85%. Since then, a surge for Donald Trump has pulled that back to 76%.

The latest national poll average has 44% of voters opting for Clinton and 42% for Trump, but the Electoral College math, which makes it more important to win in certain states rather than others, still favors the Democrat.

One key state to watch is Ohio, where the winner has nearly always claimed the presidency. George W. Bush in 2004 and Barack Obama in 2012 were both taken over the 270 College-vote threshold by Ohio. Trump is now slightly ahead in the Ohio polls. It’s also worth noting that his recent boost has put Trump ahead in five of the 12 most crucial states, and that in two others Clinton has only a marginal lead.

The U.S. is waking up to the possibility that this race could go to the wire.

Markets Have Been Pricing Gridlock

Financial assets have been discounting a Clinton White House, a Democratic Senate and a Republican House of Representatives. Markets would seem to prefer this outcome because a balance of power limits the potential for extreme policies. Less cynically, there is some evidence of bipartisan support for infrastructure spending . Debate about how much to spend and where to spend it could still leave the idea bogged down in Washington, but a well thought-out fiscal stimulus program could be a driver of stronger growth.

But a strong consensus for a certain electoral outcome like this creates the potential for volatility should polls start to signal a Trump presidency, or Democratic control of the House.

With more uncertainty now coming through in the polls, investors have to ask themselves what these candidates’ policies will really look like. The first debate in a week’s time may make things clearer, but at the moment that’s a challenge: Trump has no track record and his pronouncements have often been vague, and while Clinton clearly has form it’s still difficult to know how seriously to take her statements on issues like drug-pricing policy.

In other words, a few shocks in the polls could leave us facing considerable political uncertainty. That’s likely a recipe for more volatility.

The Weighing Machine Needs the Voting Machine

The great value investor Benjamin Graham once said, “In the short run, the market is a voting machine but in the long run, it is a weighing machine.” His words resonate during times like these.

Those of us who, like Graham himself, think of markets as weighing machines, guiding prices gradually towards economic fundamentals, acknowledge the role the voting machine plays in giving us compelling entry points for long-term investments.

We appear due for a re-pricing of risk. Brexit couldn’t provide it. The Fed appears unwilling to. Step forward the American voter.

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