Stocks and share prices surged after the Democratic Party secured a decisive victory in the midterm elections.
Tens of millions of Americans took part in the closely watched vote, which had been framed as a referendum on the White House. Voters were also reacting to rising petrol prices, the economic impact of tariffs and the war in Iran.
The Democrats captured control of both chambers of Congress, giving them the power to block legislation, launch investigations into Donald Trump’s administration and obstruct his judicial and senior government nominations.
As results emerged from across the country, the Dow Jones Industrial Average climbed 1,100 points, or 2.3 percent, after the Republican Party suffered a major political setback. European indexes also rallied, gaining about 2.0 percent in afternoon trading.
Amazon.com was among the biggest winners, rising 7.1 percent. Meta Platforms added 1.6 percent, while Alphabet advanced 3.4 percent.
Several publicly traded companies, however, moved sharply lower. Elon Musk-led SpaceX and Tesla were among the laggards, falling 1.9 percent and 3.9 percent respectively.
Musk had spent almost half a billion dollars supporting Republican candidates, including campaigns aimed at keeping Republicans in control of Texas, the home state of both companies.
Financial analysts now expect Democratic control of the House and Senate to produce significant political gridlock, particularly after Trump previously vowed to become ‘Mr Veto.’
Donald Trump suffered a staggering midterm election defeat
A trader works on the floor of the New York Stock Exchange (NYSE) at the opening bell in New York City on November 4, 2026
Kathleen Brooks, research director at trading platform XTB, said: ‘Gridlock may be bad for politics, but it is good for markets. US indexes have traditionally staged a strong rally after midterm elections.’
‘Following the recent sell-off in stocks, particularly AI-linked shares, the conditions could be in place for a strong performance through the end of the year,’ she added.
As stocks advanced, the dollar weakened against other major currencies and oil prices fell sharply. Brent crude, the international benchmark, shed 3.0 percent.
Trump has strongly supported US technology companies, but the Democratic victory has raised concerns that artificial intelligence and data center development could face tighter regulation.
Scott Chornert, head of US equity strategy at Citi Research, said: ‘It’s pretty clear that the AI trade will face some headwinds there…. If you push out the pace or change the pace of the data center build out, you begin to change the fundamental trajectory for many of those suppliers.’
The AI sector has faced mounting pressure in recent weeks as investors question Big Tech’s rapidly rising spending on artificial intelligence and the limited evidence so far of sufficient returns.
Although concerns about tougher AI regulation initially weighed on Asian markets after the Democratic victory, US indexes remained resilient. The tech-heavy Nasdaq rose 1.6 percent after falling steadily since last week.
European markets also advanced despite official data released Wednesday showing that eurozone inflation had reached a three-year high of 4.0 percent in October.
Traders work on the floor of the New York Stock Exchange at the opening bell in New York City on November 4
Stocks and shares climbed after the Democrats’ decisive midterm election victory
Markets across Asia also performed well, although Tokyo closed lower as weakness in the technology sector weighed on the broader index.
Bond yields avoided the volatility seen in recent trading sessions, while gold benefited from its appeal as a safe-haven asset.
Patrick O’Hare of Briefing.com noted that Trump had signaled an end to the election by congratulating the Democrats and saying he looked forward to working with them.
‘Reading between those lines, the market took comfort from the understanding that the overall election result won’t be contested,’ he wrote in a note.
Beyond the US election, investors continued to assess third-quarter corporate earnings.
BMW said Wednesday that it planned to accelerate job cuts after reporting a decline in third-quarter profit. The announcement sent its share price 6.0 percent higher.
Google, meanwhile, said it planned to invest $15 billion in Malaysia over the next two years to develop data centers and other infrastructure. Its shares rose 3.4 percent.
This story is developing, more to follow.
