Good morning,

Yesterday as Americans headed to the polls it was a mixed day in markets. Oil prices continued to move modestly lower amidst more headlines suggesting that diplomatic efforts are underway. Equities opened around unchanged, rallied through the morning, only to fade in the back half of the session. The S&P 500 ended the day up 0.5% as tech bounced, while some of the defensive sectors that had outperformed recently pulled back. Staples and materials led to the downside falling nearly 2% while energy, financials, healthcare and Utilities were also lower.

Last night’s results were decisive with Democrats taking both the House and Senate as well winning multiple Governor races most notably in all of the “data center states” (TX, GA, OH, PA, MI etc.). The ultimate outcome was not all that surprising as Blue Sweep has been trading between 65% - 75% in prediction markets for the last month, but the magnitude/breadth was a surprise. It has been a volatile evening/pre-market with S&P futures initially selling off ~1.5% as polls were closing but started to bounce around midnight as President Trump began making comments saying he would accept the outcome, suggested he’d be willing to work with Democrats and downplayed the prospects of bombing Iran. S&P futures are up just ~1% while futures on the Russell 2k and Dow Jones Industrial Average are up closer to 2%. The VIX is around 18 from north of 20.