Wall Street Wants To Make Money No Matter Who Wins

Amid the tightest presidential race in decades, investors are angling for ways to make money no matter who the victor is. Which stocks are they betting on?

By Betsy Stark ABCNEWS.com Oct. 31 - From Wall Street’s point of view, no matter who wins the race for the presidency, there's money to be made.

“The theory is, investors shouldn't care who wins,” says Andrew Laperriere, a political economist with the ISI Group.“They just want to know who’s going to win so they can invest appropriately.”

Professional investors are lining up their bets.

Good News for Big Tobacco

A win by Texas Gov. George W. Bush is seen by investors as a win for Microsoft because he is less likely to support breaking up the company for alleged antitrust violations. Investors also think Bush might ease off on the tobacco companies, which is good news for Philip Morris and R.J. Reynolds. Drug companies are also expected to benefit from a Bush victory.

“Drug stocks, in particular, could rally because investors fear a Gore presidency could mean price controls on drugs,” says Greg Valliere, chief strategist with Schwab Washington Research Group.

Banking on Fuel Cells

If Vice President Al Gore wins on Nov. 7, money managers see opportunity in companies that specialize in environmental services and clean-fuel technologies.

Additionally, Gore's commitment to expanding the Internet into public schools may drive up the stocks of computer makers and Internet companies such as America Online and Yahoo!.

Whomever wins, what Wall Street wants from Washington is a continuation of the budget surpluses, low interest rates and fiscal discipline that have driven the economy and the stock market into the record books. And the best way to insure the status quo — and keep the new administration in check — is to elect a divided government. So professional investors hope whichever party wins the White House loses the Congress. “The pervasive feeling on Wall Street is that the best scenario is gridlock and divided government,” Valliere says. “That’s what professional money managers are really rooting for in November.”