December 6, 2022

california cargiver

Awesome Business

Midterm elections: Red ‘wave’ fails to materialize; control of Congress too close to call

3 min read

Hill Street Studios/DigitalVision via Getty Images

In a U.S. midterm election where very few seats were changing hands, the first key narrative shift came well after midnight, with Democrat John Fetterman projected by numerous decision desks to win a Pennsylvania Senate seat – the first seat in that chamber projected to change party hands.

With the Senate coming into election day deadlocked at 50 seats for each party, the flip made it increasingly likely that not only wouldn’t Republicans take control of the Senate as they hoped, but that the Democrats might end up increasing their majority.

That may depend on final results in Georgia, Arizona and Nevada, three states where Democrats were running strong Senate races. Fetterman’s win leaves 48 Senate seats in Democrats’ hands to 47 for the GOP. In Georgia, with more than 95% of the vote counted, Democratic incumbent Raphael Warnock held a slim lead over GOP challenger Herschel Walker, 49.4% of the vote to 48.6%. If that result holds as is likely, with both below 50%, then a runoff between the two would decide the seat on Dec. 6, a full four weeks away.

In Arizona, with 55% of votes in, Democrat Mark Kelly held a 56%-41% lead over challenger Blake Masters. And in Nevada, with 56% of votes in, incumbent Democrat Catherine Cortez Masto was leading Adam Laxalt 51%-46%.

Over in the House, early projections saw Republicans picking up perhaps a few dozen seats and retaking control of the chamber – and while they’re still likely to take control of the House, it appears they might do so with a slim majority similar to that of the Democrats coming into the day – perhaps 225, vs. a needed 218 seats. NBC’s decision desk sees it much, much closer: 218 GOP seats to the Democrat’s 217 when all is said and done, a one-vote margin.

The status quo largely prevailed, and as previously noted, that can be good for markets, which tend to rally out of midterm elections.

Cannabis was on the ballot in five states, as Arkansas, Maryland, Missouri, North Dakota and South Dakota all weighed recreational marijuana use. It passed overwhelmingly in Maryland – no surprise as the issue had wide support there – and also won in Missouri, while trailing in Arkansas and North Dakota. That marked a split result for multistate operators including Cresco Labs (OTCQX:CRLBF); Columbia Care (OTCQX:CCHWF); Trulieve Cannabis (OTCQX:TCNNF); Green Thumb Industries (OTCQX:GTBIF); Curaleaf Holdings (OTCPK:CURLF); MedMen Enterprises (OTCQB:MMNFF); Acreage Holdings (OTCQX:ACRHF); Ayr Wellness (OTCQX:AYRWF); Verano Holdings (OTCQX:VRNOF); and Jushi Holdings (OTCQX:JUSHF), as well as ETFs: AdvisorShares Pure Cannabis ETF (YOLO), Amplify Seymour Cannabis ETF (CNBS), ETFMG Alternative Harvest ETF (MJ), AdvisorShares Pure US Cannabis ETF (MSOS), and Global X Cannabis ETF (POTX).

On a night where few narratives looked likely to change much, the outlier results stood out. First, Florida made a much heavier shift toward the GOP than expected, with Republican incumbent Gov. Ron DeSantis cruising to re-election and picking up support in previous Democratic strongholds, and GOP Sen. Marco Rubio running to a fairly easy re-election win. Florida once was a swing state in presidential elections, and now looks firmly in the GOP camp.

And abortion-rights measures were clear winners in the first national election since the Supreme Court overturned Roe v. Wade. Voters in California, Michigan and Vermont amended constitutions to allow for abortions and contraceptive use – and even in Kentucky, voters opposed amending the state constitution to say that citizens had no right to an abortion.

The elephant in the room was former President Donald Trump, who faced a repudiation in the results as several of his backed candidates did poorly, and presumed 2024 presidential rival DeSantis built on his own strength. More than a half-dozen Republican gubernatorial candidates who had refused to say whether they would have certified President Biden’s win in their state were headed toward defeat.

Compared to past national elections, there were few violent swings in market indicators, and stock index futures showed mixed results in the wee hours: As of 2:20 a.m., S&P futures (SP500) are down 0.05%, Nasdaq (COMP.IND) futures up 0.12%, and Dow (DJI) futures are down 0.12%.

“Obviously we don’t have 100% reporting in on anything yet, but it doesn’t look like anything we have seen so far has spooked markets at all,” said Charles Schwab’s Randy Frederick.

Check out more about what to watch in markets as the races become final.

Copyright © All rights reserved. | Newsphere by AF themes.