By Hilary Russ
NEW YORK, Nov 6 (Reuters) – Stock markets edged up modestly on Tuesday, with trading thin in the United States, while the dollar and Treasury yields held steady, as Americans went to the polls in a pivotal midterm election that could shift the balance of power in Congress.
MSCI’s gauge of stocks across the globe gained 0.12 percent.
The elections mark the first major test of President Donald Trump’s polarizing personality and hardline policies on taxes, trade and immigration. If his Republican party loses control of the House of Representatives, some of his power could be curbed.
“Unlike the U.S. presidential election or the U.K.’s Brexit referendum, the upcoming U.S. (midterm) elections are not a binary event,” said Yasuo Sakuma, chief investment officer at Libra Investments.
“So it’s unlikely to send stocks significantly in one direction, apart from initial quick reactions.”
European shares slipped on disappointing corporate earnings and caution ahead of the U.S. vote. Politics weighed on Italian stocks, and oil prices fell as investors digested exemptions to sanctions on Iranian oil. The pan-European STOXX 600 index lost 0.20 percent
On Wall Street, the Dow Jones Industrial Average rose 111.62 points, or 0.44 percent, to 25,573.32, the S&P 500 gained 8.92 points, or 0.33 percent, to 2,747.23 and the Nasdaq Composite added 28.70 points, or 0.39 percent, to 7,357.56.
“With the Democrats favourites to take control of the House and the Republicans the Senate, the next couple of years may be far more difficult for Trump,” said Craig Erlam, a senior market analyst at Oanda in London.
“When you consider how markets have done since his election victory – granted,