  Detailed characterization of exoplanets has begun to yield measurements of
their atmospheric properties that constrain the planets' origins and evolution.
For example, past observations of the dayside emission spectrum of the hot
Jupiter WASP-12b indicated that its atmosphere has a high carbon-to-oxygen
ratio (C/O $>$ 1), suggesting it had a different formation pathway than is
commonly assumed for giant planets. Here we report a precise near-infrared
transmission spectrum for WASP-12b based on six transit observations with the
Hubble Space Telescope/Wide Field Camera 3. We bin the data in 13
spectrophotometric light curves from 0.84 - 1.67 $\mu$m and measure the transit
depths to a median precision of 51 ppm. We retrieve the atmospheric properties
using the transmission spectrum and find strong evidence for water absorption
(7$\sigma$ confidence). This detection marks the first high-confidence,
spectroscopic identification of a molecule in the atmosphere of WASP-12b. The
retrieved 1$\sigma$ water volume mixing ratio is between $10^{-5}-10^{-2}$,
which is consistent with C/O $>$ 1 to within 2$\sigma$. However, we also
introduce a new retrieval parameterization that fits for C/O and metallicity
under the assumption of chemical equilibrium. With this approach, we constrain
C/O to $0.5^{+0.2}_{-0.3}$ at $1\,\sigma$ and rule out a carbon-rich atmosphere
composition (C/O$>1$) at $>3\sigma$ confidence. Further observations and
modeling of the planet's global thermal structure and dynamics would aid in
resolving the tension between our inferred C/O and previous constraints. Our
findings highlight the importance of obtaining high-precision data with
multiple observing techniques in order to obtain robust constraints on the
chemistry and physics of exoplanet atmospheres.
