Wall Street responded positively to the "Blue Wave" that gave Democrats control of both the House and the Senate. On Wednesday morning following the midterm elections, major market indexes and media stocks posted gains. The Dow Jones Industrial Average rose over 1,100 points in early trading, up 2.2% to nearly 53,000, while the Nasdaq Composite index climbed 2.4%.
Analysts suggested the sweeping congressional victory removed political uncertainty, with investors feeling bullish that the likely gridlock in D.C. would keep policies unchanged. Jay Woods, chief market strategist at Freedom Capital Markets, told CNBC that while "still more uncertainty looms," it is certain there will be gridlock, which he noted is "historically... good for the market." Woods also attributed the market uptick partly to President Donald Trump’s "initial tone and reaction to the results" after the President told the New York Times he would accept the midterm results.
According to the AP, as of Wednesday morning, Democrats held a 54-44 edge over Republicans in the Senate, with two races in Mississippi and Alaska still to be called. In the House, Democrats secured 228 seats for a clear majority, while the GOP stood at 139, with outcomes in 68 races remaining undetermined.
Several media stocks gained in early trading on Wednesday morning, including Netflix (+4%), Comcast (+4%), Disney (+3.8%), Skydance (+2.8%), and Fox Corp. (+2.4%). Big tech stocks also trended higher despite warnings from analysts that Democratic majorities could create headwinds for AI data center buildouts; Apple rose 6%, Amazon rose 7.6%, Alphabet rose 4.9%, and Meta rose 2.4%. Mike Bell, head of strategy at RBC BlueBay Asset Management, told the Times that while the midterms are a "political tornado," the markets are "less likely to be blown around by this result."
Not all stocks saw gains. Shares of Tesla fell 2.4%, and Elon Musk’s SpaceX was down 1.3% in morning trading. CNBC reported that Musk, the world’s wealthiest individual, spent at least $474 million backing Republican candidates, which included $224 million toward the campaign of Texas attorney general Ken Paxton for the open Senate seat in Texas. Democrat James Talarico won that seat by a 12-point margin. Additionally, voters in Texas elected Democratic contender Gina Hinojosa as governor, unseating incumbent GOP Gov. Greg Abbott. Late Tuesday night, Musk posted on X, “Guess my election-interfering space lasers didn’t work this time,” followed by a shrug emoji.
