Global stock markets saw a significant rally following the U.S. midterm elections, with investors responding to the Democrats’ gains in Congress and potential shifts in economic and energy policies. The U.S. stock market had a notable rise, with the S&P 500 climbing 1.7%, the Dow Jones Industrial Average surging over 3% for a gain of roughly 1,600 points, and the Nasdaq Composite advancing 1.7%. Canada’s S&P/TSX Composite Index also rose 2.3%, while the Canadian dollar strengthened against the U.S. dollar.
Meanwhile, oil prices dropped sharply, with Brent crude falling 8.7% to $94.62 per barrel, its lowest in about two months. This decline was driven by expectations that increased Democratic influence in Congress might lead to pressure on the Trump administration regarding its stance on the Iran conflict.
The election results had varied impacts across different sectors. Healthcare companies and discount retailers saw substantial gains, anticipating potential policy changes in healthcare funding and assistance programs. HCA Healthcare shares surged 10.9%, and Dollar Tree gained 8.7%. Renewable energy companies also benefited, with First Solar rising 4.7% and Enphase Energy advancing 4.3%, amid expectations of greater political support for solar and wind energy.
In contrast, defense contractors and major oil companies faced declines. Lockheed Martin shares fell 6.7%, Northrop Grumman dropped 4%, and ExxonMobil decreased by 4.9% due to the falling crude prices.
Technology stocks showed mixed performance, as investors weighed the possibility of tighter regulations on artificial intelligence and increased scrutiny of data center investments. Nvidia shares declined by 2%, CoreWeave fell 9.6%, Tesla lost 2.6%, and Trump Media and Technology Group experienced a significant 23.5% drop.
Lower oil prices also eased concerns about inflation, causing U.S. Treasury yields to move lower. The yield on the 10-year Treasury decreased to 4.88% from 4.95%. In global markets, European and Asian stocks had mixed reactions, with markets rising in Paris, Shanghai, and London, while Japan’s Nikkei 225 declined by 1.4%.