SEATTLE — The stock market made almost a complete reversal Thursday, after stocks soared the day before, following Democrats’ decisive victory in the midterm elections.
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On Wednesday, the Dow Jones Industrial Average jumped 1,569 points, or roughly 3%, to reach its best day since April 2025.
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Stocks generally do well in the months following any midterm U.S. election, regardless of who wins, the Associated Press noted.
There’s been a sharp selloff by Thursday, and the Dow shed over 1,700 points.
Investors are selling off tech and other artificial intelligence (AI) stocks over concerns that a Democrat-controlled Congress will slow down the buildout of data centers nationwide.
Across the country, voters elected Democratic candidates who campaigned on legislative guardrails for AI and passed dozens of state and local ballot measures limiting construction of new data centers. New Democratic leadership has previewed a major change in its approach to the AI industry, compared to that of the Trump administration and other Republicans.
“Two things will change next term: We will hold public hearings on AI. We will pass legislation, reasonable guardrails on AI,” said California Rep. Ted Lieu, vice chair of the House Democratic Caucus.
Still, financial advisors said the current volatility in the stock market is not surprising following the midterms, and many encourage people not to make rash decisions as a direct result.
“We should always be looking far down the road and avoid the short-term reactions. The last two days are a perfect example of that,” said Bill Barlowe, a local financial advisor with Edward Jones.
Barlowe said people should talk with their financial professionals to analyze their own investment portfolios, their risk tolerance, and how balanced the portfolio is. He discourages anyone from reacting to the market’s current ups and downs.
“My advice is always, keep calm and don’t overreact,” Barlowe said. “You’re on your own path in life, so you need to adjust for your own goals.”
The stock market typically fluctuates for a few weeks to a few months following an election, Barlowe explained. He predicts the market will remain somewhat volatile through January, when new Congress members are sworn in.
