Investors weigh policy gridlock after Democrats sweep US midterms

Democrats won control of both houses of Congress in the US midterm elections, a rebuke of President Donald Trump’s policies, with 54 Senate seats and 220 House seats as of Wednesday afternoon Singapore time. The result raises prospects of policy gridlock between the White House and Congress, potentially limiting further fiscal stimulus. US equity futures fell about 1 per cent, while technology stocks faced pressure on AI valuation and regulatory concerns. In Asia, Singapore’s Straits Times Index recovered from early losses to close nearly flat at 5,268.63. Analysts flagged US debt-ceiling negotiations and Fed rate expectations as key risks, while the dollar weakened and gold fell 0.5 per cent to US$3,925.25 an ounce.