Democrats have taken control of the House and Senate.President Donald Trump remains in the White House.Republicans are furious.
Democrats are celebrating.And millions of Americans are staring at their retirement accounts wondering one thing: What the heck does this mean for my 401(k)?Should you sell stocks? Buy gold? Move everything into cash? Before you make a move, you might want to look at what history actually tells us.
Because this particular combination of political power has produced some surprising stock market results.STATE OF PLAY: BLUE WAVE SWEEPS DEMOCRATS INTO POWER, WITH KEY RACES STILL HANGING IN BALANCEAccording to research from RBC Wealth Management and Bloomberg, the S&P 500 has historically averaged just 4.9% annually when a Republican president faces a Democratic-controlled House and Senate.House Democratic Leader Hakeem Jeffries, House Minority Whip Katherine Clark and Democratic candidate Suzan DelBene celebrate at a Democratic Congressional Campaign Committee midterm election night watch party in Washington, D.C., on Nov.3, 2026.
(REUTERS)That's the lowest average among six political configurations studied from 1953 through 2025.Compare that with the other combinations:TRUMP PLEDGES TO VETO 'INSANE' DEM BILLS, PINPOINTS ISSUE PARTIALLY TO BLAME FOR REPUBLICAN LOSSESThose are historical annual price returns, excluding dividends, not predictions for 2027.But here's what should catch your attention.
Not all political gridlock has produced the same stock market results.And anyone telling you Wall Street always loves divided government isn't looking at the complete numbers.Before you start selling everything in your retirement account, there's another statistic you need to know.According to Capital Group, the S&P 500 has averaged a 15.4% gain in the 12 months following midterm elections since 1950.Even more remarkable? Every post-midterm 12-month period in that study produced a positive return.
That's a pretty impressive historical bat...