On Nov 3, 2026, Democrats won control of the House and the Senate, according to network projections (some races were still uncalled). The next day the market rose, but not everything rose. Here is what moved and what history says, with real closes.
Nov 4 close versus Nov 3 close.
Analysts (Jefferies, cited by Reuters) expect the 2027 defense budget to land closer to the House's roughly $1.15 trillion than the administration's $1.5 trillion request. From January, Democrats will chair the committees that write spending bills.
Oil fell the same day and dragged oil producers.
Some coverage tied it to the prospect of tighter rules for AI data centers. They were already coming off a very bad October.
From the close on each midterm Election Day. Own calculation with Yahoo daily closes.
| Election | Congress result | S&P 3 months | S&P 6 months | S&P 12 months | Nasdaq 12 m | Dow 12 m |
|---|---|---|---|---|---|---|
| 1998 11-03 | Republicans keep both chambers | +14.5% | +21.9% | +22.0% | +69.3% | +21.9% |
| 2002 11-05 | Republicans win the Senate, keep the House | −7.8% | +1.2% | +14.9% | +39.8% | +13.2% |
| 2006 11-07 | Democrats win both chambers | +4.9% | +9.2% | +6.7% | +15.7% | +9.4% |
| 2010 11-02 | Republicans win the House | +9.3% | +14.0% | +3.7% | +4.2% | +5.8% |
| 2014 11-04 | Republicans win the Senate | +1.5% | +5.1% | +4.5% | +11.2% | +2.8% |
| 2018 11-06 | Democrats win the House | −0.9% | +6.4% | +11.7% | +14.0% | +7.2% |
| 2022 11-08 | Republicans win the House | +7.6% | +8.1% | +14.5% | +28.6% | +2.9% |
In the 7 midterms since 1998, the S&P 500 rose over the following 12 months all 7 times, with a median of +11.7% (own calculation with Yahoo closes). After 3 months it was down in 2 of the 7. This is history, not a guarantee.
On fears of a smaller Pentagon budget under a Democratic-majority Congress: analysts expect 2027 defense spending closer to $1.15 trillion than the $1.5 trillion requested. Lockheed Martin fell 7.0% that day.
In the data since 1998, the S&P 500 rose over 12 months both when Republicans won and when Democrats won. Over the long run, stocks are driven mostly by corporate earnings and interest rates.
Educational and opinion content, not financial advice. We take no side on parties. Sources: CBS, NBC and CNN projections (Nov 3–4, 2026), Reuters via Business Standard and Investing.com, Yahoo Finance closes via the Faro. The past does not guarantee the future.