US stock futures extended losses as early midterm vote counts pointed to a strong Democratic showing, raising worries over tighter regulatory scrutiny in sectors that have powered a bull market on Wall Street. Contracts on the S&P 500 Index fell 0.7% at 8:57 p.m. in New York, while futures on the Nasdaq 100 Index lost as much as 2%, erasing earlier gains.
Decision Desk HQ said Democratic incumbent Jon Ossoff is projected to win the Senate race in Georgia, dealing an early blow to Republicans, and Democrat Cory Booker is projected to win the Senate race in New Jersey. Democrat Roy Cooper also won the open Senate seat in North Carolina. Jamie Hannah, deputy head of investments at Van Eck Associates Corp. in Sydney, said markets are sensitive to the outcome and expects continued S&P 500 futures volatility as more results firm up.
Wall Street expects stocks to fall if Democrats regain control of both houses of Congress. Prediction market Kalshi shows the odds of Democrats taking both houses jumping to 86%, from about 72% a few hours earlier. Still, history has generally favored stocks after midterm elections. Large-cap equities have gained about 15% on a market-cap-weighted basis in the six months after midterms since 1982, according to Morgan Stanley data.
Chipmakers gained even more, with the Philadelphia Semiconductor Index climbing 2.6% after a recent rout fueled by concerns over AI spending. Advanced Micro Devices Inc. gave a revenue forecast that exceeded analysts' estimates, showing that demand for data center processors remains strong. Super Micro Computer Inc. also forecast revenue above estimates and raised its annual sales outlook. Charu Chanana, chief investment strategist at Saxo Markets in Singapore, said the market appears to be pricing a potential Democratic sweep.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing