Tech stocks sell off after Democrats win midterms, DAX hits record
Global markets reacted with initial relief followed by sharp declines after Democrats secured clear majorities in the US Senate and House. Tech stocks fell sharply, with Oracle dropping over 8% and Intel falling 14%, while the DAX hit a new high.
Following the US midterm elections, where Democrats secured clear majorities in the Senate and House, global markets reacted with initial relief followed by sharp declines. The DAX hit a new high of nearly 26,700 points on Wednesday before crashing later that evening due to US market reactions. In the US, tech stocks fell sharply; Oracle dropped over 8%, Intel fell 14%, and Tesla declined 12% at its peak. Historical data cited indicates the S&P 500 has risen in the 12 months following midterms in 95% of cases since 1938.
Analysts noted that while Democrats may increase regulation on data center energy and water usage, AI remains a megatrend, suggesting current corrections could present buying opportunities for companies with solid balance sheets. Donald Trump remains in office, with Stephen Miller appointed as new White House Chief of Staff, maintaining potential for policy chaos despite the electoral defeat. The hosts argued that the initial market rally was purely psychological and that the subsequent drop reflects a reassessment of which sectors benefit from Democratic control, viewing the correction as a potential entry point for solid AI companies.