US stock indices closed higher on Wednesday, 4 November, after the Democratic Party won a decisive victory in the US midterm elections. The Dow Jones Industrial Average rose 3.03 percent to 53,356.12, the S&P 500 gained 1.58 percent to 7,688.62, and the Nasdaq Composite added 1.44 percent to 25,736.51. Democrats won majorities in the House of Representatives and the Senate, and also took several key governorships, including Texas.
Oil moved the other way. US crude and Brent prices fell more than 8 percent after Vice President JD Vance cited the war with Iran as a factor in the Republican defeat. By our market data, Brent spot stood at $107.03 a barrel at the close of 3 November, its lowest in 31 days.
Investors welcome political gridlock
Andrew Slimmon of Morgan Stanley Investment Management said markets like political gridlock. “They do not like one party having too much power,” he said.
Jay Woods, chief market strategist at Freedom Capital Markets, said the rally was partly driven by the president’s attitude and his initial response to the results. Uncertainty still lingers, he said, but the government will face political gridlock, which has historically been good for markets.
Trump accepts result, war outlook unclear
Trump said he was willing to accept the midterm results, which eased political uncertainty. Before the vote, investors had feared Democratic restrictions on data centres would hit AI-linked stocks.
Peter Boockvar, chief investment officer at One Point BFG Wealth Partners, said the election results may push efforts to end the war. “We will see how things develop,” he said. Americans, he added, had clearly expressed dissatisfaction with inflation and gasoline prices, among other issues.
Data: FRED — St. Louis Fed · S&P Dow Jones Indices · Nasdaq
