US election results shake global markets and weaken dollar

Global markets were shaken and the dollar weakened after the Democrats' unexpectedly clear victory in the US midterm elections, securing control of both the Senate and the House of Representatives. Asian tech stocks initially fell sharply but recovered most losses before closing, while Wall Street futures pointed slightly lower ahead of Wednesday's opening. According to Elisabet Kopelman, US economist at SEB, the "wallet issue" drove the Democratic win, reflecting voter protest against rising prices and the war in Iran rather than support for Democratic policies. She attributes downward pressure on tech stocks to politicians winning on promises to slow large investments in data centers and AI infrastructure, which also weighs on the dollar as money moves away from Wall Street tech giants. Kopelman notes this could benefit European stocks, while high market interest rates are easing slightly as results confirm a divided government between Congress and the White House, blocking major tax cuts and fiscal reforms. She expects Democratic control to slow the Trump administration's massive defense spending, reducing budget deficit risks, though the 10-year Treasury yield only fell 0.05 percentage points to 4.93 percent. Bitcoin dropped nearly 3 percent overnight to its lowest since September before recovering, while oil prices remained stable around $103 per barrel.