Markets on Edge as America Votes: Asian Stocks Retreat, Oil Steadies Near $104 After a 7 Percent Fall
Reuters reports investors worldwide are waiting on Tuesday's midterm result before they move: Asia opened lower, Wall Street slipped Monday, and crude steadied only after peace-talk hopes knocked more than 7 percent off its price in a day.
The world's markets spent the hours before America's midterm vote doing as little as possible. Reuters reports that stocks edged lower at the start of Asian trade on Tuesday and oil prices stabilised after the previous session's tumble, with investors on edge ahead of the start of voting in elections that will decide control of Congress. The MSCI index of Asia-Pacific shares outside Japan was down 0.9 percent, led by a decline of as much as 3.8 percent in Korean shares, while S&P 500 futures edged up 0.1 percent and Japanese markets were closed for a holiday.
Wall Street had already set the cautious tone overnight. The S&P 500 slipped 0.5 percent on Monday as technology earnings weighed on confidence, and Apple shares extended their losses, falling 2.8 percent in after-hours trading after the company forecast lower gross margins for the holiday quarter, citing rising memory-chip costs. The yield on the 10-year Treasury bond rose 2.1 basis points to 4.913 percent. Analysts at ING, quoted by Reuters, summed up the mood: Tuesday, they wrote, will be nothing more than the day ahead of a much bigger day, with guidance on the midterms and the Treasury's quarterly refunding announcement still to come.
Oil told the week's other big story. Brent crude was last 0.1 percent lower at $104.72 a barrel in Asian trade, steadying only after falling more than 7 percent on Monday as talks between Iranian and Qatari officials lifted hopes for an end to the US-Israeli war with Iran and a stabilisation of Middle East crude supply. For New Jersey drivers and heating-oil households, that swing is not abstract: energy prices are the cost-of-living pressure voters themselves name first in this election, and the price at the pump on Election Day sits downstream of exactly this market.
What the markets think happens next is hedged, and Reuters reports it as such. Opinion polls favor the Democrats to win the House while the Senate remains too close to call, and the prediction markets Polymarket and Kalshi assign around a 75 percent probability that Democrats will control the Senate. MUFG analysts cautioned that Brazil's election surprise is a reminder that prediction markets can misprice political tail risks. None of it is a result — it is the price of uncertainty, quoted on the night before New Jersey and the country actually vote.
