"What happens Monday and Tuesday, who knows? There's this general feeling that on Wednesday, people think it's binary. Trump wins, the market goes down. Hillary wins, the market goes up. It's more nuanced than that," said Peter Boockvar, chief market analyst at The Lindsey Group. "If Hillary wins, and Democrats take the Senate, if you own health care or financial stocks, you're not going to be happy that Elizabeth Warren and Bernie Sanders are running the Senate."
There is also some concern that if the election is close, and Trump loses, he might challenge the outcome, creating more uncertainty for markets.
"We should all hope the winner, no matter who it is, is clear cut. We don't want to hear about whining losers. We want to elect the person and move on," Boockvar said.
Barclays analysts estimate the S&P 500 could lose as much as 11 to 13 percent if Trump wins, and it faces headwinds of 4 to 5 percent if his probability of winning gets to 50 percent. They based their analysis on market moves and the election odds, after the first presidential debate. They also examined moves after the news of an FBI investigation into Clinton emails, and when Trump won key Republican primaries. PredictIt.org on Friday put the odds of a Trump win at 31 percent and a Clinton win at 74 percent, an improvement of about 6 points for Clinton over Thursday's level.
Keith Parker, Barclays global equity strategist, said the market may sell off on a Trump victory, but like the period after the U.K. Brexit vote in June, stocks may bounce back as investors focus on the economy and growth. The Fed is also expected to continue to be accommodative, and perhaps not hike rates, as expected in December if markets are turbulent.
"I think the real key is equities are all about confidence, and … my analysis is probably based on Trump's policies toward trade and immigration, which are very much a risk to economic growth, while his other policies on tax and fiscal spending are positive for growth. My clue as a strategist is that I would look to whether we see 'good Trump' or 'bad Trump,'" said Parker.
Whether the market would spring back in a 'V,' like it did after Brexit, is not clear. "I think that really is predicated on Trump's rhetoric and also what you're getting out of the economic data," he said. Parker said the market is still not pricing high enough odds of a Trump win, and it could be volatile Monday and Tuesday, ahead of the election results.
"In line with a well-known risk event, you typically trade choppy in front of that. I would think that plays out over the next two trading days, and then we obviously have options markets pricing in a pretty big jump on November 9," he said. Analysts pointed to a move of somewhere around 3 percent Wednesday.
Citigroup chief U.S. equity strategist Tobias Levkovich sees a smaller decline of about 3 to 5 percent if Trump wins, given in part the S&P's nine days of declines. The S&P has lost just about 3 percent in its longest losing spree since 1980.
"Let's say he wins, the market will sell off, then we're going to assess and say, 'What are his policies?' and we'll see who coalesces around him," said Levkovich.
Levkovich said it was not long ago that the market was worried a Clinton win could be a landslide, bringing in enough Democrats to control the House and Senate. But those fears faded with news of the FBI investigation into her aide's emails. "If Trump wins, you had enough of a turnout that probably keeps the Senate Republican too," said Levkovich. "It's really hard getting the Democrats sweeping the House."
But either of those scenarios are unexpected and would surprise the markets.
"On Trump, the issue is more about we don't know his policies. There's a lot of fear around trade. It's not clear to me the Democrats would be good on trade either. Both parties meet there at the fringes," Levkovich said.
Levkovich said a better way to measure the election impact may be through sectors where the two parties could make a real difference. He said energy might do better with Trump because it might get less regulatory scrutiny. Health care would be hurt by both candidates, but Clinton has had a long term issue with drug pricing and the stocks have fallen when she has attacked companies for drug prices.
Citigroup analysts expect a Trump victory would send Treasury yields higher and steepen the curve, though yields have been moving lower in a safety trade. They also expect the dollar to continue moving lower if Clinton wins, but if Trump wins there would be safe-haven flights to the yen and Swiss franc. Emerging market currencies would be vulnerable, especially the Mexican peso which moves lower when Trump is perceived to be doing well.
While the market has seemed comfortable with Clinton, it's unclear how it will react longer term to her as president, and the FBI investigation adds a new level of uncertainty.
"It's an emotional roller coaster," said Parker. "The email investigation should lead markets to price out the progressive agenda. That's a net net mild positive, but it also leads you to the conclusions that a lot of the stuff she wanted to get done, some of that would have been bipartisan, is off the table for some time. I think a lot of the programs that would have been mutually agreeable with a Republican house have fallen off considerably."
But if there's a contested election, that would make for a scenario where the president is already damaged coming into office. Levkovich said in 2000, when Al Gore challenged the close election, stocks bottomed on Dec. 20, a week after the Supreme Court ruled in George W. Bush's favor. There was an 11 percent decline between Election Day and Dec. 20.