Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, US, November 2, 2026.
Brendan Mcdermid | Reuters
S&P 500 futures turned red on Tuesday evening as traders speculated that Democrats would win the House of Representatives and squeak out a majority in the Senate as results of 2026 U.S. midterm elections begin rolling in.
Futures tied to the broad market index traded 0.1% lower, while Nasdaq-100 futures shed 0.3%. Futures tied to the Dow Jones Industrial Average were down 137 points, or 0.3%.
Kalshi odds for Senate control increased to around 80%, while the odds for House control were showing a nearly certain victory for Democrats, leaving it all up to the Senate.
“History tells you in the first few days after election, there’s this need to digest what just happened,” said Philip Blancato, Osaic chief market strategist. If stocks come under pressure because of the election results, the market will “eventually recover and finish the year higher” in accordance with historical trends, he said.
If a Democrats were able to secure a sizable majority in the Senate — the so-called blue wave scenario — the market, especially stocks related to the artificial intelligence buildout, could come under pressure on Wednesday, according to some on Wall Street. Investors fear a big Democrat win could mean more restrictions on data centers nationwide. AI-linked stocks have already pulled back in recent weeks on concern about a slowing pace in data-center spending.
AMD shares initially surged double digits in post-market action after the company, a key player in the AI trade driving the bull market, reported third-quarter earnings and revenue that blew past analyst expectations, with data center revenue almost doubling from a year ago. The stock was last up nearly 5%.
“I think the market broadens out significantly,” Blancato added. “In that scenario of a Democratic sweep when there’s less funding for AI or less support for data centers specifically, I think the rest of the market will do quite well because of how strong earnings have been.”
On the overall market, investors believe a blue wave would also be a headwind as it likely rules out any more business-friendly policies like tax breaks and possibly increases scrutiny on industries like banking. Conversely, stocks could see some short-term momentum if Republicans end up retaining control of one or both chambers. To be sure, the polls have yet to fully close in all states, and CNBC has not called any races.
The AI trade recovered a bit during Tuesday’s session with the Nasdaq Composite rising nearly 1%, bolstered by gains in chipmakers. The S&P 500 also finished higher with a 0.3% climb, while the Dow Jones Industrial Average closed more than 200 points, or 0.5%, lower.
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