NEW YORK ( TheStreet) -- Citigroup ( C) was the winner among the nation's largest banks on Election Day, with shares rising over 3% to close at $38.47. With the presidential race a toss-up between President Obama and Mitt Romney, investors showed confidence in the economic recovery, as the Dow Jones Industrial Average
and S&P 500 ( SPX.X) ended with 1% gains, with a slight gain for the NASDAQ Composite index. Of course, with such a close race, there is a possibility that we won't know the outcome of the presidential election on Wednesday morning, which would, of course, add to the uncertainty investors are already facing, as they wait for Congress to negotiate to resolve the "fiscal cliff," hopefully before the end of the year. The fiscal cliff refers to the expiration of tax cuts enacted by President George W. Bush and extended by President Obama in 2010, as part of his compromise with Republican members of Congress, in order to raise the federal debt ceiling. Along with the tax increases, many economists fear that required federal spending cuts could send the U.S. economy back into recession. UBS equity strategist Nick Nelson early on Tuesday wrote that in addition to the election, "investors will have much to digest this week," including "a critical Greek parliamentary vote on a new budget package" on Wednesday. Nelson added that "Europe's crisis management will likely be the driver of any dramatic swings in risk appetite in the very near-term, while the US fiscal cliff debate will loom large once we have a new President-elect." The KBW Bank Index ( I:BKX) rose 1.5% to close at 50.70, with all 24 index components seeing gains, except for New York Community Bancorp ( NYB), which was down slightly to close at $13.47. Citigroup's shares have now returned 46% year-to-date, following a 44% decline during 2011. The shares trade for 0.7 times their reported Sept. 30 tangible book value of $52.70, and for eight times the consensus 2013 earnings estimate of $4.64 a share, among analysts polled by Thomson Reuters. The consensus 2014 EPS estimate is $5.01. Following former Citigroup CEO Vikram Pandit's recent ouster, investors are looking for new CEO Michael Corbat to speed-up Pandit's long-term "good bank/bad bank" strategy of placing noncore assets into Citi Holdings and winding them down, in order to boost regulatory capital ratios and enable a significant boost in the company's return of capital to investors, through share buybacks and an increase in the dividend on common shares, which is currently at a nominal penny per quarter.