After the Democratic Party's election victory, Brent crude oil plummeted nearly 9%, with Asian chip and data center stocks declining.

According to Reuters, after the Democratic Party scored a series of major victories in the U.S. midterm elections, oil prices, chip stocks, and the U.S. dollar came under pressure in Asian morning trading, while most other assets rose as markets bet on a cooling outlook for U.S.-Iran tensions. Overnight, Brent crude futures plunged nearly 9% to below $100 per barrel, with a weekly decline of around 20% so far; if the downtrend persists through Friday’s close, it will mark the largest single-week drop since April 2020. In Asian morning trading, oil prices tested the overnight low near $93.50. The pullback in energy prices boosted bonds and pushed yields lower, with the euro rising to around 1.1273 against the U.S. dollar, the greenback hitting a roughly one-month low, and supporting equities. The S&P 500 index closed up 1.6%, while European stocks hit a roughly two-month high; the solar energy sector led gains, as markets expect the Democratic Party to increase support for renewable energy. Meanwhile, Asian data center and related equipment suppliers weakened on expectations of stricter regulation. South Korea’s KOSPI, dominated by chip stocks, fell around 4% in morning trading, approaching a roughly seven-month low; Taiwan’s Weighted Index dropped about 1.8%, and Japan’s Nikkei 225 fell around 0.5%. Multiple Democratic candidates in Texas and Georgia who opposed data center construction won their elections; analysts believe demand for AI and data centers remains strong in the long term, but may slow in the short term. The yield on the 10-year U.S. Treasury note fell around 6 basis points overnight, and dropped another 1 basis point in Tokyo morning trading to around 4.87%; the 2-year yield fell to roughly 4.56%.