Global stocks fell Wednesday and the dollar weakened after US Democrats won majorities in both the Senate and the House, feeding fears that rapid AI progress could be slowed by regulatory checks, Reuters reported via Digi24.

Analysts say the “Democratic wave” is becoming clearer: wins in states long seen as out of reach, including South Carolina, Texas and Iowa. The wave highlighted frustration with Donald Trump’s economic management and with the February war against Iran that spiked fuel prices. Polls showed voters focused on the cost of living.

AI-sector shares dropped quickly, pressuring the dollar; crypto fell on fears of tougher rules. Bonds did well as investors sought less volatile assets. The AI boom has supported global equities through tech giants’ spending on data centres — hence sensitivity to anything that could block expansion.

The midterm outcome may also affect US fiscal outlooks and sectors such as defence, healthcare and banking. “It seems investors are buying in hope markets will rebound after an initial equity sell-off. (…) political gridlock does not necessarily mean weaker corporate results,” said Saxo analyst Charu Chanana.

In Asia, Samsung, SK Hynix and TSMC fell hard before recovering; the Nikkei-225 closed −1.42%, Kospi +0.62%. US bond yields fell and the dollar weakened on expectations of lower government spending and the idea that AI regulation could temper growth and the need for higher rates. In Europe, the FTSE-100, DAX 40 and CAC 40 opened higher.

Source consulted: Blue-wave effect on markets: dollar weakens, AI regulation fears — Digi24.

Image: New York Stock Exchange (Wikimedia Commons, CC BY-SA 4.0).

Sources consulted: Blue-wave effect on markets: dollar weakens, AI regulation fears — Digi24.