Private investors have more confidence that a re-elected Barack Obama will be positive for equities than if his Republican opponent Mitt Romney wins the White House, according to the Investor Outlook survey conducted by Lloyds TSB Private Banking in the US, UK and other significant global economies.

With over 2,700 global investors surveyed (37 per cent living in the UK and 63 per cent from a further 11 countries around the world, of which 13 per cent are from the US) 46 per cent of the US investors believed a second term for Obama would benefit the US and global equity markets, and subsequently deliver on US economic recovery, compared with 42 per cent who favor Romney. Some 56 per cent of UK investors surveyed chose Obama on the economy, against 10 per cent who have more faith in Romney – partisanship mirrored by the other global investors surveyed, as 58 per cent side with Obama, 13 per cent with Romney.

With barely a week to go before polling day, the state of the US economy and public finances have been major debating points in the election, which according to most polls, has both men running neck and neck. Of interest to the wealth management sector has been whether and how both men would approach the taxation of high net worth individuals.

Split down the middle

The US investors surveyed are evenly split on which presidential candidate would make the greatest positive impact on US equity markets, should he be elected (42 per cent approval for each candidate), while UK investors surveyed showed a high level of confidence in Obama (42 per cent, against 13 per cent for Romney). Global investors followed suit, with 47 per cent favoring the incumbent, compared with 16 per cent who have greater faith in Romney.

The survey shows US investors hold marginally greater faith in Obama to have a positive impact on global equity markets (41 to 36 per cent), while UK and global investors remain fervent in their favor of Obama – 49 versus 11 per cent and 47 versus 13 per cent respectively.

The survey also reveals that US debt is the second biggest concern for global investors, behind eurozone debt, while UK investors regard it as the third biggest concern, behind slowed economic recovery in the UK and eurozone debt. Naturally, US debt is the number one concern for US investors.

“The US remains overwhelmingly the most influential economy globally and, with issues like the US fiscal cliff looming on the horizon, this presidential race is being keenly followed by investors around the world. Investors don’t like uncertainty and many currently seem to be favoring Obama on the economy, while also believing that his re-election would have a better impact on equity markets,” said Ashish Misra, head of investments at Lloyds TSB Private Banking.

Amid strong concerns about the state of the economy, Misra said “the best-case scenario for investors would be a ‘trifecta’ – the President representing the party that also controls the Senate and House of Representatives.”