Dow gains about 1,500 points after Democrats win Congress, but AI infrastructure stocks fall

The Dow Jones Industrial Average was up about 1,511 points, or 2.9 percent, in early afternoon trading Wednesday, back above 53,000 for the first time since September 8, CNBC reported. The S&P 500 gained about 1.8 percent and the Nasdaq Composite about 1.9 percent after Democrats won majorities in both the House and the Senate. Every figure below is an intraday reading, and the closing numbers will differ.

Why did stocks jump on a result that hands Democrats both chambers?

The reporting points to two causes, and they are different in kind. The first is the usual case for divided government. Andrew Slimmon of Morgan Stanley Investment Management was quoted by CNBC saying markets "like gridlock" and do not like "a party with too much power." Trump also told the New York Times he was "absolutely willing" to accept the results, which Yahoo Finance said reduced fears of a political confrontation.

The second cause is the war, and it shows up in the oil price.

What happened to oil?

U.S. crude fell more than 8 percent, CNBC reported, after Vice President JD Vance blamed the Iran war for Republican election losses. Yahoo Finance's live coverage had West Texas Intermediate under $90 a barrel, about $15 below Friday's $104 close, on pace for its worst week since April 2020. The energy sector fund XLE was down more than 5 percent, with refiners hit hardest.

Peter Boockvar of One Point BFG Wealth Partners told CNBC "there's just going to be even more pressure to end the war." That is a forecast about politics, not a policy change. Neither source reports a ceasefire or a shift in military policy.

Who won and who lost inside the index?

• Apple rose 6 percent to a record $354.33, putting its market value above $5.12 trillion. Amazon gained 7 percent, Microsoft 6, Alphabet 5 and Meta 2.
• Nvidia fell 1 percent and Tesla 2 percent.
• Hospital and insurer stocks jumped: HCA rose 7.16 percent, Molina 6.3 and Centene 5.
• First Solar rose 8.5 percent. The consumer staples fund XLP hit an all-time high, up more than 2 percent.
• Walmart gained 4 percent and Bank of America 3.

The gains are not confined to one theme. Health, solar, banks and megacap tech all rose, which is harder to explain with a single story than the oil drop is.

Why did AI infrastructure stocks fall in a rally?

CoreWeave fell more than 7 percent and Nebius more than 4 percent, CNBC reported. The neocloud fund dropped 6 percent and the SOXX semiconductor fund 1 percent. CNBC ties part of that to the Texas governor's race, which Gina Hinojosa won after pledging an immediate data-center moratorium. Yahoo Finance's GuruFocus-syndicated article links the drop to worries that new Texas leadership could obstruct infrastructure projects.

A pledge is not a law. The sources do not say what authority a Texas governor would have to halt projects, so the size of the risk is unmeasured. Thierry Wizman of Macquarie said a politically driven data-center slowdown would be "adverse for the U.S. dollar." The dollar index was down about 0.4 percent at 101.32.

How unusual is a day like this?

CNBC said the Dow was on pace for its best day since April 9, 2025, and the S&P 500 for its best since April 8, 2025. The April 9 rally came the day Trump paused his reciprocal tariffs, so a one-day move of this size has come from a policy reversal before. This one comes from an election result, with the 10-year Treasury yield near 4.9 percent in CNBC's two readings. The closing prices will show how much of the afternoon gain held.