Democrats’ landslide victory in midterm elections shocked Wall Street this week.
The biggest shocks were felt in the shares of companies linked to the rise of artificial intelligence, amid concerns that a Congress controlled by Democrats to curb further data center development.
Defense and oil companies fell on expectations that Democrats will push for an end to the war between USA e Iranwhich would likely reduce energy prices.
Meanwhile, hospital stocks rose on the prospect of funding for several government programs being restored or increased, while alcoholic beverage companies and others hit by tariffs advanced on hopes of relief.
Here’s a look at how certain stocks and industries reacted to the outcome of the midterm elections.
AI Stocks
The frenetic construction of data centers to fuel the AI boom has meant big profits for a wide variety of companies, such as chip makers, energy providers, cooling system producers, cloud computing companies and more. Investors, eager to get a piece of those gains, went all in, driving some stocks up 100% or more. But concerns grew that AI stocks became too expensive. And then the Democrats swept the midterm elections and took control of Congress.
Nvidia, Lam Research and other companies linked to the AI boom swung sharply this week on fears that Democratic victories in state legislatures across the country could mean a slowdown in new construction, particularly in Texas. Hyperscalers, or those financing expansion, such as Amazon, performed better.
Defense
Defense companies have been volatile all year, rising and falling with changes in the United States’ war with Iran. Hopes for an end to the war increased after the Democratic victory in the midterm elections. The end of the conflict could mean less business for several large defense companies, although hostilities have also depleted weapons reserves, which could translate into demand for resupply by the US government.
Northrop Grumman, Lockheed Martin, RTX and General Dynamics fell between 4% and 12% after Tuesday.
Oil and refining companies
Oil exploration and refining companies have been some of the biggest beneficiaries of the United States’ war with Iran, which has restricted global supplies since February and raised the price of crude oil and gasoline. Several large energy companies retreated after the midterm elections because the end of the war would reduce oil prices and reduce the companies’ profits.
Companies like Exxon Mobil and Phillips 66 are still showing solid earnings so far this year.
Elon Musk’s companies
Elon Musk spent more than $445 million in an attempt to help Republicans maintain control of Congress. Not only was his investment return not great, but shares of his two publicly traded companies took a hit amid concerns that a Democratic Congress would investigate the mogul’s work as Trump’s cost-cutting chief in 2025. SpaceX, which houses Musk’s xAI business, and Teslawith plans for a fleet of mostly autonomous vehicles, fell 5% and 10.1%, respectively, after the midterm elections.
Trump Media
The president’s social media company, Trump Media & Technology, lost 33% of its market value in the three days after the election. The president’s stake in the company was worth almost $5 billion in March 2025. It is now worth less than $600 million. The company hopes to improve its fortunes by joining nuclear fusion company TAE Technologies. The completion of the agreement is pending.
Electrical companies
Companies focused on wind, solar and other forms of renewable energy could see brighter days with a more industry-friendly Congress. Democrats will have overwhelming influence over funding when they take control of Congress in January, fueling hopes for a wide range of green energy companies.
However, companies involved in powering the data centers at the heart of the AI expansion did not fare as well, after several skeptics of such centers were elected to Congress or governorships.
Hospitals
Hospitals moved forward in hopes that funding for several government programs, including Medicaid and Affordable Care Act (ACA) subsidies, will be restored or increased. Medicaid spending fell under Trump. Expanded tax credits for the ACA were allowed to expire without being renewed, leading to a decline in enrollment in insurance coverage nationwide. More funding for those programs would translate into a potential boost for health care providers, including hospitals.
HCA Healthcare rose 6.9%, Tenet Healthcare gained 6.2% and Universal Health Services added 10.4% after Tuesday.
Home builders and home improvements
The housing sector, including construction companies, remains under pressure from historically high home prices and mortgage rates. The shift in power in Congress could mean a greater focus on policies that address affordability, which was a key issue for Democrats. Cutting tariffs and reducing energy costs could lower supply chain costs. That could also help home improvement retailers by easing pressure on consumers.
However, mortgage rates are a more complicated issue for the industry. The Federal Reserve is expected to raise its benchmark interest rate again in an effort to cool inflation. That likely means interest rates on many types of loans, including mortgages, will remain high.
DR Horton gained 4.9%, PulteGroup rose 4.4% and Home Depot added 2.9%.
Alcohol
Beer, wine and spirits companies could see relief from tariffs that have hurt sales in the United States and globally when Democrats take control of Congress. The hope is that they will act to end the global tariff conflict that has driven up prices. S&P 500 members Constellation Brands, which has U.S. import rights for Corona and Modelo beers, and Brown-Forman, which makes Jack Daniel’s and other spirits, posted gains.
Home goods
Makers and sellers of everyday consumer staples advanced as investors exited riskier sectors. They were also helped by hopes that a change in congressional control would mean policies that would help cool inflation. Eliminating or reducing tariffs could help lower costs for companies. Ending the United States’ war with Iran could increase global oil supplies, lowering crude oil prices and shipping costs for everything from food to clothing.
After the election, Costco Wholesale added 3.4%, Procter & Gamble rose 2.1% and Dollar General advanced 2.5%.
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This story was translated from English by an AP editor with the help of a generative artificial intelligence tool.
Source: www.independentespanol.com
