How Wall Street analysts think the midterms could affect the stock market

November 3, 2026 / 1:26 PM EST / CBS News

The midterm elections could reshape Congress as lawmakers grapple with persistent inflation, high energy prices and rising fiscal debt. For investors, by contrast, the political outcome could deliver a boost.

Data from financial firm Edward Jones shows that the S&P 500 stock index rose an average of 1.7% in the month after the last 14 midterm races, dating back to 1970. In the six months following midterm elections, S&P returns averaged 15.5%.

"Volatility around the vote is possible, but markets have historically performed well in the year following midterms as political uncertainty recedes and attention returns to the economic outlook," Magdalena Ocampo, market strategist at the global investment firm Principal Asset Management, said in an email on Tuesday as Americans cast their votes.

With congressional control in the balance, Wall Street analysts are also considering the impact divided government could have on stocks if the Democrats win the House, Senate or both chambers. Political gridlock has historically been good for markets because it limits Congress' ability to pass sweeping tax and spending legislation, reducing the risk of volatility, according to analysts.

"Less change makes a more predictable environment, which allows…

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