Dow Jones Surges 3% After Midterm Election Shift in Power

US stocks jumped Wednesday after President Donald Trump’s party lost its sole control of Washington.

The Dow Jones Industrial Average gained more than 3%, adding over 1,500 points in a single session. The S&P 500 rose 1.6% and the Nasdaq composite climbed 1.4%. Hospital operators and dollar store chains led the gains as investors reacted to nationwide Republican losses.

Asian markets reacted differently on Thursday. Shares tied to artificial intelligence faced heavy selling, causing South Korea’s Kospi index to drop 3.5% to 5,484.38 by late morning. Samsung Electronics fell 5.7% and memory chipmaker SK Hynix lost 7.4%. In Tokyo, the Nikkei 225 slipped 0.5% to 61,914.53. SoftBank Group, which invests in OpenAI, shed 5.3%, while chip equipment maker Tokyo Electron dropped 7.7% and Advantest tumbled 9.4%.

Markets with lower exposure to AI performed better. Hong Kong’s Hang Seng index jumped 2.8% to 24,597.59. Australia’s S&P/ASX 200 rose 1.9% to 9,003.40, and the Shanghai Composite edged up 0.1%. Oil prices hovered near two-month lows as Brent crude traded around $94 a barrel.

Specific companies saw sharp moves based on the new political balance. Trump Media and Technology Group fell 24.5% to $4.49. Tesla dropped 3.3% and SpaceX declined 3.8%. Defense contractors retreated on the prospect that a Democratic-led Congress could influence the war with Iran. Lockheed Martin sank 6.9% and Northrop Grumman fell 4.5%.

Cheaper oil weighed on major producers. ExxonMobil fell 4.6% and ConocoPhillips dropped 5.2% as Brent crude plunged 8.7% to $94.62 per barrel the previous day. By early Thursday, Brent slipped a further 0.8% to $93.91. Renewable energy stocks gained from the split government, with First Solar rising 4.6% and Enphase Energy climbing 3.7%.

Currency markets showed minor shifts. The US dollar eased to 157.96 Japanese yen from 158.41 yen, while the euro strengthened to $1.1256 from $1.1228.