Markets stateside could be in for a “significant correction” if the Democrats make a clean sweep in next year’s U.S. elections, according to one Goldman Sachs analyst.

A “unified Democratic result” where the party secures the presidency as well as both chambers of Congress would make the partial or full rescinding of tax cuts passed in 2017 “highly likely,” said Timothy Moe, co-head of macro research in Asia at Goldman Sachs.

“If that was to happen, then you would lower 2021 S&P 500 earnings potentially by about 12% if you have a full (rescinding) of the tax cut,” Moe told CNBC. “That, in turn, could lead to a significant correction in the U.S. markets.”

“I think that’s a risk that the markets will play with next year and could possibly price partly in, especially if we come into the year having had very strong gains with the S&P up about 26% year to date,” he said.

Looking ahead through 2020, Moe said the market is “likely to have some challenges”.