"Given Obama's advance in the poll, it's pretty clear who's going to be president," said Owen Fitzpatrick of Deutsche Bank, quoted by AFP.
Moreover, Mace Blicksilver, director of Marblehead Asset Management said that “for most investors, Obama’s victory is already incorporated into the market’s dynamics”.
Intrade website, an online trading exchange portal whose members can speculate on the outcome on the candidate’s odds, Barack Obama is the favorite with a 84.5% winning margin while John McCain’s is 16.6%, down from over 50% in September, NewsIn informs.
Economists at IHS Global Insight calculated a 53.1% chance of victory for the democrat over McCain’s 46.9% which is “not surprising” considering the ongoing economic crisis.
Sam Stovall, strategist for Standard & Poor’s relies on statistics: if the market declines between August and late October before the elections, power passes from one party to another. The situation has arisen six times since 1928, and only once the rule has been bucked: the reelection of Republican Dwight Eisenhower in 1956.
Although it is preparing for a democratic win, the world’s leading financial market is expected not to respond well.
"If Obama wins with a significant margin, I could promise you that Wednesday will be a very hard down day,” Wall Street, Mace Blicksilver said. “Investors know that capital gains taxes are going up, and they'll say 'I don't want pay a third more in tax,” he added.
"If McCain wins I promise you the market will go up 10 percent on the opening and stay up all day," predicts Blicksilver.
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