Drug and coal stocks will likely rally on a victory by Donald Trump but could fall if Hillary Clinton wins, say equities strategists. Fred Katayama reports.
With the race still tight, investors are plagued by uncertainty over whether Democrat Hillary Clinton or Republican Donald Trump will become the next U.S. president, and that sent stocks south last week. Political analysts on Wall Street Reuters talked to still expect Clinton to win, but the small gap in the polls has investors on edge. Some equity strategists predict the markets will rally on a Clinton victory because she's a known quantity who's not expected to make huge changes. Expect the opposite, Wunderlich's Art Hogan says, with a Trump victory. SOUNDBITE: ART HOGAN, CHIEF MARKET STRATEGIST, WUNDERLICH SECURITIES, (ENGLISH) SAYING: "It's a big unknown, and there's a lot of fears about things like our relationships with other sovereigns, trade wars, um, just the national feeling of protectionism and anti-globalization and things of that nature. The market doesn't celebrate that." A Trump win, strategists say, would likely bolster drug stocks and dirty energy, meaning oil and coal producers. David Shiegoleit of U.S. Bank: SOUNDBITE: DAVID SHIEGOLEIT, MANAGING DIRECTOR OF INVESTMENTS, U.S. BANK PRIVATE CLIENT RESERVE, (ENGLISH) SAYING: "That side of the energy market stands to benefit from a Trump Administration because he has telegraphed very very strongly that he is in favor of strengthening that side of the energy equation. And meanwhile, simply due to the fact that he is probably more of a free market person when it comes to healthcare, the biotechnologies, the pharmaceuticals should have certainly a relief rally in the sense that there's little forecast for price controls at that point." Expect the flip side with a win by Clinton, who has criticized drug price hikes and called for phasing out fossil fuels. Coal and drug stocks could face headwinds, while clean energy and hospital stocks could benefit.