(FORTUNE Magazine) – THE CHIEFS of America's largest corporations have formed their recent business outlook on the assumption that George Bush will become President. On the eve of the election they looked forward eagerly to the business conditions they expect to prevail under a Bush Administration and discussed specific actions they might take -- actions that would mostly mean good news for the economy. The prospect of a Dukakis victory practically chilled their spines. The CEOs figured investors will see things much as they do; by their estimate, a Bush victory rather than a Dukakis win would be worth 200 extra points on the Dow Jones industrial average by year-end. These are among the results of the latest FORTUNE 500/CNN Moneyline CEO poll. The independent opinion research firm Clark Martire & Bartolomeo conducted the survey between October 12 and October 21, questioning 234 CEOs from FORTUNE 500 and FORTUNE Service 500 companies. Polls extending back to last winter have shown that a solid majority of America's top CEOs favor Bush. But while 90% believed last February that the Republican nominee, whoever he might be, would win in November, that expectation wilted during the summer after the Democrats nominated Dukakis and Bush's nomination by the Republicans was assured. By mid-October, however, 89% of the CEOs polled had decided that a Bush win would not change the immediate outlook for their businesses, indicating a strong presumption that he would prevail. Why were they so gung-ho for Bush? Answers emerge in some of the poll's most striking results. When asked under which President they would be more likely to expand their businesses, 62% chose Bush. Exactly one respondent, representing less than half of 1% of the total, chose Dukakis. Observes J. Landis Martin of NL Industries: ''With Bush we have the security that governmental regulations won't increase during the next three years, so the cost of expansion won't be too high.'' A sizable minority of CEOs (33%) felt the outcome of the election would not influence their plans to expand. ''We won't change our strategy no matter who is President,'' says Fuqua Industries' J. B. Fuqua, one of the few Democrats among the CEOs. David Hinson of Midway Airlines says, ''We'll just keep running a good airline regardless of politics.'' Almost as impressively, 51% of the chiefs said they would more likely increase capital spending under Bush, while only a single respondent said he would under Dukakis. In the CEOs' view Bush is also far better news for job creation. Although Dukakis made ''good jobs at good wages'' one of his principal campaign themes, only 1% of the CEOs said they would be more likely to increase their work force under Dukakis than they would under Bush; 49% said Bush would more likely mean more jobs at their companies, and another 49% said the election's outcome wouldn't affect their hiring plans. Most said the election would not influence their plans to borrow money or adjust inventories. A few CEOs believe Bush would benefit their industries specifically. Martin's NL Industries includes a drilling services operation, and he says, ''We think there is a good chance for a tax incentive to drill for natural gas or oil, which means our profits would continue to improve.'' That would be especially good news, considering that drilling services at NL have lost $700 million over the past six years and are just breaking into the black this year. E. B. Leisenring Jr. of Westmoreland Coal expects Bush to boost his business too. ''Bush will sign into law a cost-effective clean air act that Reagan was not in favor of,'' he says. ''This could encourage utilities to switch from high- to low-sulfur coal, which will be favorable to my company.'' The CEOs believe that Wall Street is pro-Bush as well. The median of their forecasts equates a Bush victory with a slightly rising Dow; they predicted a close of 2200 at year-end, vs. 2140 when FORTUNE went to press. Their median forecast based on a Dukakis win was a decline to 2000. Looking beyond the medians at the full range of forecasts shows a more dramatic result: Only one CEO thought the Dow would close below 2000 at year-end if Bush were elected, while 27% thought it would close above 2200; when the CEOs were asked to imagine a Dukakis victory, the figures were almost precisely reversed. The CEOs were so confident of their candidate's abilities that, when asked what they feared most about a Bush Administration, their most common answer was ''nothing.'' Among those who cited specific concerns, the most prevalent was a worry that Bush wouldn't or couldn't effectively deal with the economy's No. 1 problem, the budget deficit. ''Can he make the tough decisions on expenditure cuts so that the budget deficit can be reduced significantly?'' asks Kenneth Lay of Enron, a Houston-based natural gas utility. Others worried that Bush would not be able to work with a Democratic Congress. Says John B. Smith of Mayflower Group, an Indiana transportation company: ''I fear that with a Republican President and a Democratic Congress we'll just float along, and the real problems -- the budget and trade deficits -- won't be addressed.'' Roughly the same number of chiefs were concerned about something happening to Bush -- and Quayle becoming President. Harry Bubb of Pacific Mutual Life speaks for many when he says, ''Quayle is scary.'' The general question of Bush's leadership and vision disturbed almost as many CEOs. Edwin Lupberger of Middle South Utilities worries that ''we might end up with a stalemate between the congressional and executive branches due to his lack of leadership. Reagan had an ability to articulate and communicate his programs that Bush doesn't seem to have.'' All these fears amount to little compared with what the CEOs thought would happen in a Dukakis Administration. Nearly all the leaders surveyed expressed some sort of concern about the Massachusetts governor's moving to the White House. Perhaps it's to be expected, but they worried most that he would do just what George Bush said he would: tax and spend. Richard P. Wollenberg expresses a widely held view when he says, ''I fear a burgeoning welfare state.'' Jess Hay of Lomas Financial had doubts about whether ''his tax policy would be one that encourages savings, capital formation, and entrepreneurship.'' Many chief executives considered Dukakis just plain antibusiness. His long connection with Harvard certainly won him no points with this group. ''I fear the selection of academic advisers rather than business advisers,'' says John D. Nichols of Illinois Tool Works. W.R. Grace's J. Peter Grace gripes, ''He'd bring down a group of Harvard professors with new ideas not really tried or proven.'' Several CEOs believed that Dukakis's agenda would include increased government regulation of business. ''I fear that heavy government bureaucracy will return again, with all things that flow from that,'' says Robert Luciano of Schering-Plough. Many cited Dukakis's lack of experience on the national and world scenes. The CEOs believed Dukakis especially weak in international affairs. Observed Peter L. Scott of Emhart: ''He has a complete lack of understanding of international negotiations and the problems we have, particularly with the Russians.'' Frank Wobst of Huntington Bancshares would fear ''a somewhat more amateurish approach to our foreign policy.'' Other leaders surveyed thought Dukakis would induce inflation. Why? Says Edward B. Brandon: ''He lacks the ability to control spending, and we'll have to inflate the economy to take care of that.'' As the U.S. economy enters its seventh year of uninterrupted expansion, American CEOs could hardly be expected to want to rock the boat. Ultimately, that seems to be why they were such enthusiastic fans of Bush. Says T. Neal Combs of Fruehauf, a Detroit auto parts manufacturer: ''The Bush Administration will represent the status quo -- slow, steady growth. And that's a very good thing for business.''

BOX: Q Would the election of George Bush significantly change your outlook for your business? A Yes 11% No 89% Not sure -

Q Would the election of Michael Dukakis significantly change your outlook for your business? A Yes 66% No 31% Not sure 3%

Q Would you be more likely to ((take the following steps)) with Bush as President or with Dukakis as President? No A Bush Dukakis difference Not sure Expand your business 62% * 33% 5% Increase capital spending 51% * 43% 6% Increase your work force 49% 1% 49% 1% Increase borrowing 32% 2% 58% 8% Increase inventories 23% * 58% 19% * Less than 1%

Q What do you fear most about a Bush Administration? A Nothing 37% No progress on deficit 21% Impasse with Congress 9% Quayle as President 9% Lack of leadership 8% Higher taxes 5%

Q What do you fear most about a Dukakis Administration? A Higher taxes 38% Higher spending 18% More regulations 14% Lack of experience 12% Inflation 9% No progress on deficit 8%

Q Where would you expect the Dow Jones industrial average to close on December 30, 1988, if Bush is elected? If Dukakis is elected? A Bush (median) 2200 Dukakis (median) 2000