Quotes: Wall Street awaits midterm vote tallies in upbeat mood
2022.11.08 21:07
© Reuters. FILE PHOTO: Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar
NEW YORK (Reuters) – Investors are expecting Republican gains in U.S. midterm elections, a result that could ease worries about Democratic spending and regulation but set up a bruising fight over raising the U.S. debt ceiling next year.
Wall Street ended higher on Tuesday during voting in midterm elections that will determine control of the U.S. Congress, with investors betting on a political stalemate that could prevent major policy changes. [.N]
Republicans are favored to win control of the House of Representatives and possibly the Senate, polls and betting markets show, though it may be hours before all vote tallies are known. With Democrat Joe Biden in the White House, that result would lead to a split government, an outcome that has been accompanied by positive long-term stock market performance in the past.
COMMENTS:
TROY GAYESKI, CHIEF MARKET STRATEGIST, FS INVESTMENTS, NEW YORK
“In the chance that both the House and Senate flip, it could lead to a miniature kind of sideways slash bear market rally, but ultimately, Fed tightening, money supply contraction and inevitable recession will dominate the changing political landscape in the US.”
“When you think of the order of importance to markets, it’s really the Fed, the economy, the very troubling situation overseas and the midterms they’re just not terribly relevant over the next 6, 12, 18 months, because they’re really almost a non-event.”
“If the Congress flips, it could be perceived as good news by investors because it means fiscal stimulus is over and that on the margin could make the Fed’s job a little bit easier to break inflation.”
JJ KINAHAN, CEO, IG NORTH AMERICA, CHICAGO
“Having a balanced ticket in terms of Republicans, if they get the House and Senate, or just the House, will help slow some of the government spending which many have seen as one of the major contributors to inflation. So that happening may help do some of Fed’s work for them, so to speak, and that’s why that would be viewed favorably by the market.”
