The stock market has already picked the next U.S. president.....The stock market is predicting Hillary Clinton to win in a landslide.

Published: Aug 29, 2016 6:09 p.m. ET

The GOP is traditionally known as the party of Wall Street, but this year investors, for the most part, are betting against the Republican standard-bearer.

The stock market is predicting Hillary Clinton to win in a landslide.

“The market appears to have decided not only that [Hillary] Clinton will win, but that it won’t be close,” David Woo, a strategist at Bank of America Merrill Lynch, said in a report distributed Monday. “Investors like landslide victories.” Woo noted that the S&P 500 has risen more than 4% since July 5, which marks the beginning of the 90-trading-day countdown to the election on Nov. 8. During years when presidential candidates won by a margin of more than 80% of Electoral College votes, the S&P 500 posted average returns of 8.4% in the 90 days leading up to the election, as this chart illustrates: 

The last time stocks outperformed the current rally at the halfway point was when Ronald Reagan won in a landslide against Walter Mondale in 1984.

“To us, this implies that the market is expecting Hillary Clinton to either maintain or increase her already sizeable lead over Donald Trump in the opinion polls,” Woo said, citing the Iowa Electronic Markets, an indicator giving Clinton an 80% chance of beating Trump.

The IEM is a futures market operated for research purposes by the University of Iowa Tippie College of Business.

Earlier this year, Sam Stovall, U.S. equity strategist at S&P Global Market Intelligence, noted that the S&P 500 SPX, +0.52%  has a fairly good track record of predicting election results.

Since 1944, the incumbent person or party was reelected 82% of the time when the S&P 500 rose between July 31 and Oct. 31, according to Stovall. The only exceptions were in 1968 and 1980, when there were popular third-party candidates in the picture. more