By Noel Randewich
Nov 6 (Reuters) – U.S. stock futures held onto gains on Tuesday after media projections showed the Democrats winning control of the House of Representatives in U.S. midterm congressional elections.
With President Donald Trump’s Republican party holding onto their majority in the Senate, according to CNN, NBC and ABC News, the results were in line with expectations on Wall Street that Washington was set for gridlock.
A House controlled by the Democrats will hamper Trump’s business-friendly agenda and could lead to uncertainty about his administration at a time when investors are already worried that a decade-old bull market may be ending.
S&P 500 e-mini futures had earlier rose 0.4 percent as initial results showed Democrats struggling in races for the House, but those gains were pared to 0.25 percent after Fox News and NBC News projected that Democrats would take control of the House..
Higher S&P 500 futures imply traders to expect Wall Street to open with a gain in the following session.
“Right now, it looks like the Democrats will take the House,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. “Clearly, the futures market was far more buoyant when it looked as if the Democrats would have a much more difficult time.”
Stock futures remained in positive territory on expectations that the Democrats’ majority in the House would prove less than some had expected, said Stephen Innes, head of trading for Asia at OANDA brokerage in Singapore. His firm was trading e-mini futures as the election results came in.
“Investors are breathing a bit of relief it’s not a blue tsunami,” said Innes, referring