After feeling burned by backing Barack Obama in 2008, the conventional wisdom suggests Wall Street should be rooting for a Republican to take the White House in 2016.
But some believe the stock market could actually perform very well should Hillary Clinton become the first female commander-in-chief, especially if she inherits a GOP-controlled Congress.
Thats because the last time investors faced a pragmatic, pro-Wall Street Democratic president -- Clintons husband -- who was stymied by a Republican legislature, the stock market averaged a 20% rally and the economy grew at a brisk 4.2%.
As the 2016 election comes into focus, some in the markets will express alarm over a Hillary Clinton presidency.But we'd argue that she's far more centrist than Obama -- and if stocks perform even half as well in a Hillary Clinton presidency as they did under Bill Clinton, she would be most welcome on Wall Street, Greg Valliere, chief political strategist at PRG Research Group, told clients in a recent note.
Its a little early to be making White House predictions, but its clear Clinton is the early favorite to succeed Obama should she decide to make another run.
Stocks Lean Left?
Wall Street tends to favor the Republican party given its more pro-business tilt, but equities actually perform better under Democratic presidents.
According to McGraw Hill Financials (MHFI) S&P Capital IQ, since 1900 the S&P 500 has averaged an 8.6% gain when the White House is controlled by a Democrat, compared with 5.5% under Republicans. However, the S&P 500 was up a greater frequency of the time under a GOP executive branch: 69% versus 63%.
If Clinton won the White House in 2016, she would presumably inherit a Congress that is controlled by the GOP in at least one chamber.
Link:
Should Wall Street Fear Hillary Clinton in 2016?