Democrats take over US Congress and inflict unprecedented setback on Trump in midterm polls

According to InfoMoney, Democrats took control of the Senate and the House of Representatives in Tuesday's midterm vote (3/11). According to Seu Dinheiro, the Democratic majority in both Houses will come into effect from 2027. On the night of 3/11, projections indicated that the opposition would hold both Houses, according to Revista Oeste.

The vote was a defeat for Donald Trump's camp, who was elected to a second term two years ago. According to Reuters, cited by InfoMoney, the causes include the war against Iran, considered unpopular, the high cost of living and dissatisfaction with the Trump administration. Your Money credits the electorate's turnaround to the same reasons, including the way Trump leads the country.

The result also drew attention due to geography. According to Reuters, the Democrats won on traditionally Republican bases, a feat that had not been seen for generations. Your Money adds that Republicans even lost in districts that, for more than a generation, were controlled by the party.

On election night, Trump told Fox News that he intends to block laws approved by Democrats, according to Revista Oeste. The statement anticipates a scenario of direct friction between the White House and a Congress under opposition command.

Markets reacted cautiously. World stock markets fluctuated on Wednesday (4/11), according to Reuters, and investors began to consider the chance of tougher regulations, higher taxes and reinforced surveillance over artificial intelligence and cryptocurrencies.

The main fear, according to Reuters, is the risk of a legislative impasse between Trump and the Democratic Congress, a scenario in which the approval of new economic measures tends to be blocked.

What changes for the investor

For those who invest in the stock market, interest and the dollar, the central point is the combination of Executive and Legislative branches on opposite sides. With Congress under Democratic command, the tax agenda, regulation of the technology sector and inspection of artificial intelligence and cryptocurrencies become more uncertain topics, and these are the sectors that investors follow closely. The veto announced by Trump suggests that some of these discussions could drag on without a quick outcome. It is worth monitoring which projects are approved, which changes the weight of each scenario for the portfolios.

Automatically translated from Portuguese.