With the recent rise in Donald Trump's poll numbers, Wall Street is starting to contemplate the prospect of a better-than-expected Republican Party showing on Election Day.
"It's incredible to see how much the US election has changed in recent weeks," Strategas' Daniel Clifton wrote in a report to clients Thursday.
"The FBI report of new emails from Hillary Clinton's private server has turned the election from a referendum on Trump to a referendum on Clinton. ... In our meetings this week in NY and Boston, it was clear to us that investors are not prepared for a Republican sweep."
A month ago, investors were bracing for a scenario of a Democrat sweep where that party win the White House and win back both houses of Congress. Now, it seems extremely unlikely Republicans will lose the House, and Senate control has become a toss-up, according to the latest polls.
The firm put together stock portfolios for each party based upon which companies stand to do best if a particular party is in power. Using the relative performance of its Democratic versus Republican baskets, Clifton now projects Trump has a 42 percent chance to win the presidential election, which is higher than the betting markets' odds of about 30 percent....
(Excerpt) Read more at cnbc.com ...
