Market Close: Stocks Soar, Democrats Take Congress, Dow’s Best Day Since April ’25 • 11/4/26

0:00The CNBC Business News Update. I'm Jessica Ettinger. Wall Street opens Thursday morning after the best day for the Dow since April 2025, a post-midterm election rally for stocks. Democrats took full control of the House of Representatives and the Senate. The Dow finished up 1 ,569 points, more than 3 percent higher. Three M shares led the way. They were up 9.5 percent. Microsoft up almost 7 percent. The S &P 500 index added 119 points. That was 1.5 percent. The Nasdaq up 364 points, 1.4 percent. After 2024, we had the Trump trade, and it was a simplistic version of what was going to work based on the policy mix.

0:45Now it's a little bit the anti-Trump trade, or at least going against what the prevailing policies have been. That's CNBC's Mike Santoli. Chips and other parts of the AI trade notched losses as the election is seen as slowing down the AI buildout. other parts of the market rallied. Capital Alpha's James Lucere tells CNBC there still could be strikes against Iran. War and Thanksgiving very seldom go together, but if President Trump wants to get his defense funding through Congress, he probably needs to complete the war before the second half of lame duck begins after Thanksgiving. With Trump, you never know.

1:20The midterm election blowout delivered a new era in Washington. Democrats in Congress saying they'll launch a 100-day agenda to lower the cost of gas, groceries and health care, release the Epstein files and hold President Trump accountable. CNBC's Eamon Javers spoke with the president Wednesday afternoon. I just had a brief phone call with President Trump and I asked him about working with Democrats and the president was very much in a conciliatory mood and said he can absolutely work with Democrats. He wouldn't want to take tariffs off, for example, but he could work with the Democrats on financial items that he thinks would be mutually beneficial, but a little bit cagey here about exactly what those ideas are.

2:00And President Trump spoke to the media on Wednesday. Look, I mean, I'll get along probably with the Democrats unless they want to be destructive, but they have the power of the veto. So if we don't like what they're doing, they've already called and they want to talk about things and that's fine. On the president's ability to veto anything Democrats try to get done in the next two years, here's the American Enterprise Institute's James Pethokoukis on CNBC. Might there be an override of a veto? I mean, the president said that he'd be Mr. Veto, though now he's saying he's going to be Mr. Deal. But those vetoes, like, could be overridden, especially on particular consensus issues.

2:36It takes two-thirds of the Senate to override a veto. That's 67 votes as of Wednesday afternoon. Democrats hold 54 seats in January. When they take control, they would need 13 Republicans to vote along with them. Homebuilder shares soared Wednesday. Here's CNBC's Diana Oleg. The Democratic sweep of Congress could address several issues that are plaguing today's housing market. In a research note, UBS's John Lovallo wrote, Democratic control of Congress raises the potential for lower tariffs, which we estimate represents about$7 ,500 of additional cost per home. Now, the Middle East conflict has resulted, of course, in higher diesel fuel prices, which hits construction vehicles and higher interest rates.

3:19The average rate on the 30-year fixed is now about a full percentage point higher than it was a year ago, with rates taking off at the start of the Iran war. Oil prices plunged Wednesday. U.S. crude at about$88 a barrel. This after Vice President J.D. Vance blamed the GOP election defeat on the Iran war. Democrats have vowed to end it as soon as possible. On Thursday's watch list, back to earnings from Cigna, Wendy's, Shake Shack, and more. Plus, we find out how many people applied for unemployment benefits last week, and Starbucks rolls out its holiday menu. Jessica Ettinger, CNBC. Hey, Fidelity.

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