The United States will hold its midterm elections tomorrow, November 3. The results will decide which party controls Congress. However, the impact of the elections will not be limited to American politics. They could also affect global stock markets and the economy.
The results will decide whether President Donald Trump continues to get support from Congress or faces more opposition from Democrats. This could affect his plans on taxes, government spending and trade.
The elections are also important for investors. Any change in political power could create uncertainty in financial markets. Here’s how the results could affect different sectors.
How could US midterms affect stock markets?
Mark LoPresti, CEO and chief market strategist at Market Rebellion, told NewsNation that markets generally perform well after midterm elections because investors do not like uncertainty.
According to BNY Investment Strategy and Research Group, the S&P 500 has gained an average of 16.6% in the year after midterm elections since 1950. MarketWatch reported that the S&P 500 has given an average return of 15.5% in the nine months after midterm elections.
A study by Ned Davis Research found that the S&P 500 has gained an average of 14% in the year after midterm elections since 1930. However, the average gain was lower when the President’s party lost control of the House of Representatives. In such cases, the average gain was 8.8%.
Could Trump’s loss of Congress affect markets?
If Democrats win control of the House or Senate, Trump’s plans could face more opposition.
A Republican victory in both chambers could make it easier for Trump to introduce tax changes, increase government spending and make new rules. However, if Democrats win control of either chamber, they could make it harder for him to pass new laws and approve budgets.
This does not mean Trump will lose all his powers. He will still have executive powers, including the right to veto bills passed by Congress.
How could US midterms affect the economy?
The election results could also affect energy markets. Congress can influence military spending, sanctions and clean energy policies.
Changes in these areas could affect global oil prices. Any disruption to oil supplies or increase in military tensions could push prices higher.
Also, changes in American economic policies can affect the dollar and other currencies. The dollar accounted for 56.7% of global foreign exchange reserves in the second quarter of 2026. The US Federal Reserve kept its interest rate range at 3.75% to 4% on October 28.
The election results will be important for investors, but they are not the only factor that could move markets. Investors will also watch US interest rates, company spending and economic growth.
The midterm elections will decide the balance of power in Congress. However, their impact could also be felt in global markets and the economy.
US midterms 2026: How Trump’s Congress battle could affect Wall Street, oil prices and the dollar