US midterm elections could impact Indian markets, says Emkay Global
The brokerage expects geopolitical shifts and crude oil prices to influence the Sensex and Nifty following the November 2026 elections.
According to a report by Mint, Emkay Global Financial Services suggests that the November 2026 US midterm elections may affect India through geopolitical shifts and changes in crude oil, dollar, and US bond yield movements.
The brokerage expects Democrats to potentially end Republican control of both chambers of Congress. It noted that the president's party has lost House seats in 19 of the last 23 midterm elections.
For Indian equities, including the Sensex and Nifty, Emkay stated that a softer dollar, lower US bond yields, and declining crude oil prices could provide support. However, the firm warned that an escalation in the Iran conflict could drive oil prices higher, pressuring India's currency and external balances.
While historical data shows the S&P 500 has averaged gains of 6 per cent over 60 trading days after midterms, Emkay cautioned that current conditions differ. The brokerage noted that US Treasury yields and Brent crude prices have risen significantly compared to previous cycles.
The firm also mentioned that while a Democratic victory might increase scrutiny of President Donald Trump's tariff and immigration policies, the president likely retains considerable discretion. Strategic ties in defence and technology are expected to remain resilient regardless of the election result.