US stocks surge, and the Dow soars 1,500 points as Brent oil's price drops below $95 per barrel

NEW YORK (AP) — U.S. stocks are soaring Wednesday after President Donald Trump’s party lost its sole control of Washington in the midterm elections.

Stocks generally do well in the months following any midterm U.S. election, regardless of who wins, and the S&P 500 jumped 1.8%. The Dow Jones Industrial Average was up 1,501 points, or 2.9%, as of 1:11 p.m. Eastern time, and the Nasdaq composite was 2.1% higher.

Stocks of solar-power companies, dollar stores and hospital owners helped lead the way as Wall Street tried to sort the winners from losers following the widespread losses for Republicans. Investors, meanwhile, see risks ahead for Trump’s social-media company, the artificial-intelligence industry and businesses owned by Elon Musk, who donated heavily to Republicans.

The price for a barrel of Brent crude oil fell below $100 for the first time in nearly a month. Vice President JD Vance blamed the war with Iran, which caused a spike in oil prices, for Republicans’ midterm losses.

Strategists along Wall Street had been urging investors not to get swept up in the election because it may not matter much for the broad market in the long term. Prices for stocks depend more on where profits for companies and interest rates are heading than on who controls what in Washington.

“Earnings trump elections,” according to Brian Jacobsen, chief economic strategist at Annex Wealth Management.

Still, Wall Street may have gotten a preferred political scenario as Democrats are set to take control of both the Senate and the House of Representatives. Wall Street generally prefers split control of Washington because it lessens the risk of transformative changes to the economy.

Much remains impossible to predict, of course, and Trump retains executive authority over key areas such as defense, foreign policy and in some instances trade.

A downbeat forecast could be that “Trump is not now a lame duck, but an angry duck” who might restart tensions over tariffs and NATO allies’ levels of military spending, said Carsten Brzeski, global chief of macro at ING Bank.

An optimistic view, Brzeski said, is that Trump becomes “a tame duck ... that he will slow down any disruptive efforts and that he will put more focus on trying to win the Nobel Peace Prize by ending the two big wars without big disruption, and on trade, nothing happens but a few words.”

Here’s a look at some of the moves rippling through financial markets: