Fortune, Nov. 3, 2026

Wall Street is bracing for a fresh wave of tariffs, Iran action (and potentially a government shutdown) after the midterms

Though analysts have been wrong before, many observers expect the Democrats to claw back some political power in this week’s midterm elections. Despite that, Wall Street is expecting President Trump to double down on some of his less popular policies, following the vote.

At the time of writing, Harvard University’s polling gives a 96% chance that the Democrats take the House, and a 78% likelihood of the Democrats taking both the House and the Senate.

Goldman Sachs, for example, wrote to clients this morning that it expects President Trump to increase tariffs in the event the Democrats secure greater congressional influence. Economists Alec Phillips and Abhay Duggirala reasoned that “Democrats have indicated they would seek to reverse some of President Trump’s tariffs, but we expect this to have a limited effect since the reversals would likely be focused on a few countries (e.g., Canada) or products.”

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