What happened
Democrats won control of both the US Senate and House in Tuesday's midterm elections, according to Reuters. As of 12:30 AM CT, AP race calls showed Democrats had flipped 7 Senate seats and 16 House seats from Republicans, and Republicans had not picked up any Democratic seats in either chamber.
How markets reacted
- Nasdaq 100 futures fell as much as 2.4% and S&P 500 futures as much as 1.4% after the results, per Reuters.
- By 2:13 AM CT, S&P 500 E-minis were up 0.15% and Nasdaq 100 E-minis up 0.26%, per Reuters.
- The 10-year Treasury yield was down 3 basis points at 4.92%, after touching 4.89% overnight, and the dollar weakened broadly, per Reuters.
- Spot gold was at $4,042.20, up 2.85%, at 4:44 AM CT, per Kitco.
Why
Reuters said investors weighed the prospect of more oversight of areas such as AI and cryptocurrencies under a Democratic Congress. "The significance of these midterm elections is more like a referendum on AI than a referendum on Trump."Aidan Yao, Amundi Investment Institute
The quick rebound suggests markets had largely expected this result. The Morning Brief covers today's data and what's priced in.
The short version (the what and the result)
- Democrats won both chambers of Congress.
- Nasdaq 100 futures fell as much as 2.4% overnight, then turned slightly higher; gold rose above $4,000.