Democrats won control of Congress in the 2026 midterm elections, triggering sharp moves across Wall Street as investors weighed the impact on AI, defense, energy, healthcare and other sectors.
By Hermes-Vector AI Desk
The overwhelming victory by the Democrats in the 2026 midterm elections shook up Wall Street this week, according to reporting by the Associated Press carried by WRAL and the Toronto Star. Democrats took control of Congress, with the party set to have overwhelming influence on funding when it takes control in January.
AI-related stocks swung on concerns that a Democratic Congress could slow data center construction. Nvidia, Lam Research and other companies tied to the AI boom were volatile, while hyperscalers such as Amazon fared better.
Defense companies fell between 4% and 12% after Tuesday, including Northrop Grumman, Lockheed Martin, RTX and General Dynamics, on hopes that Democrats would push for an end to the U.S.-Iran war.
Oil and gas companies lost ground because an end to the war would lower oil prices and reduce profits. Exxon Mobil and Phillips 66 were still showing solid year-to-date gains.
Hospital shares rose on hopes that funding for government programs such as Medicaid and Affordable Care Act subsidies could be restored or boosted. HCA Healthcare rose 6.9%, Tenet Healthcare gained 6.2% and Universal Health Services added 10.4% after Tuesday.
Homebuilders and home improvement retailers also gained. D.R. Horton gained 4.9%, PulteGroup rose 4.4% and Home Depot added 2.9%.
Alcohol companies rose on hopes for tariff relief. Constellation Brands and Brown-Forman both had gains.
Household goods companies gained as investors moved out of riskier sectors. Costco Wholesale added 3.4%, Procter & Gamble rose 2.1% and Dollar General rose 2.5%.
Elon Musk spent more than $445 million in an attempt to help Republicans maintain control of Congress. Shares of his two publicly traded companies fell on concerns a Democratic Congress will investigate Musk’s work as Trump’s cost-cutting chief in 2025. SpaceX fell 5% and Tesla fell 10.1% after the midterms.
Trump Media & Technology lost 33% of its market value in the three days after the election. Trump’s stake in the company was worth nearly $5 billion in March 2025. Now, it is worth less than $600 million. The company is hoping to improve its fortunes by merging with the nuclear fusion company TAE Technologies. Completion of the deal is pending.
The Democratic takeover of Congress shifts the legislative landscape ahead of January, with potential consequences for data center buildouts, defense spending, energy prices, healthcare funding, tariffs and congressional oversight of Elon Musk’s companies.
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
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