US Investors Betting Against Trump As The Next President
It looks like investors may have already picked the next president—Wall Street is betting against Donald Trump and the market is responding.
“The market appears to have decided not only that [Hillary] Clinton will win, but that it won’t be close,” says David Woo, a strategist at Bank of America Merrill Lynch. “Investors like landslide victories.”
According to an S&P Global Market Intelligence analyst, Wall Street has a record of predicting future presidents. Since the early 1940s, the presiding president or party was re-elected 82% of the time when the S&P 500 rose between July 31 and Oct. 31.
Woo said the S&P 500 has risen more than 4% since July 5, the day marking the 90-trading-day countdown to the Nov. 8 presidential elections, MarketWatch reports. He also said that during years when a presidential candidate won by more than 80% of Electoral College votes, the S&P 500 reported average returns of over 8% in the 90 days prior to the election.
The last time stocks beat the current rally was when Ronald Reagan beat Walter Mondale in his 1984 landslide victory. [MW]
