The Cable

Wall Street Isn’t Thrilled About the Probability of a Clinton Presidency

Investors aren't thrilled about the probability of Hillary Clinton winning the White House.

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Wall Street expects Hillary Clinton to be president, even if it doesn’t want her in the Oval Office.

That’s the result of a CNBC survey published Tuesday of 48 respondents, including economists, fund managers, and strategists. The tiny snapshot of Wall Street movers and shakers shows 80 percent of respondents see Clinton winning the presidency in November. Only 13 percent believe Republican front-runner Donald Trump will triumph, while 7 percent said they didn’t know or were unsure.

Who they think will win is very different from who they want to win. About half of the respondents want Ohio Gov. John Kasich to become president, but not a single person polled thinks this will be the case.

Despite Trump’s background in business, his support is steadily eroding. When CNBC — a TV network that has its finger on the pulse of U.S. financial markets — conducted the same poll last month, it found 13 percent believes the businessman’s policies were best for Wall Street. That number is down to 4 percent.

“Trump said he’d be inclined to replace Janet Yellen as Fed chair,” Rob Morgan, chief investment officer of Sethi Financial Group, told CNBC. “He also said he’d support the notion of Congress auditing the Fed’s decision-making. Dangerous.”

Wall Street has been quietly bracing for the possibility of a Trump presidency, even as it increasingly views his chances as remote. The billionaire businessman has no coherent economic policy in the traditional Republican pro-corporate or Democratic pro-labor sense. He appears to be an economic isolationist in a global economy, vowing to scrap trade deals like the Trans-Pacific Partnership, a pact covering 40 percent of the world’s economy and backed by the U.S. Chamber of Commerce. He says it benefits China, even though Beijing is not a part of it.

Trump also wants to label Beijing a currency manipulator and end what he characterizes as illegal Chinese export subsidies. He’s called for penalties against companies who move jobs from the United States to Mexico, including high tariffs if they want to export back to the United States.

But it’s not just Trump who has investors worried. Some 37 percent in Tuesday’s poll said they don’t know, or are unsure, whether it’s best any of the current contenders win — whether a Republican or a Democrat.

“The current tenor of the presidential campaign and many of the policies being floated by the candidates can in no way be considered positive for the equity markets,” John Roberts, director of research of Hilliard Lyons, wrote in response to the survey.

Photo credit: JUSTIN SULLIVAN/Getty Images

 

David Francis was a senior reporter for Foreign Policy, where he covered international finance. @davidcfrancis

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