STOXX 600 Rises 1.88% on Nov 4, 2026 as Democrats Win Congress

Key takeaways

• The STOXX Europe 600 rose 1.88% to 657.77 at the close (16:30 UTC) on Wednesday, Nov 4, 2026, Yahoo Finance data show, after Democrats won control of both chambers of the US Congress.
• Spain's IBEX 35 led the region with a 3.13% gain to 19,396.70 at 16:30 UTC, while Germany's DAX added 2.38% to 26,479.33 and London's FTSE 100 rose 1.86% to 10,836.62.
• Banks led the rally: the Stoxx Europe Banks index was up 3.7% in the morning, Dow Jones Newswires reported via MarketScreener, while defence stocks fell.
• January 2027 Brent crude futures were down 7.60% at $95.73 a barrel at 16:30 UTC, before settlement. Earlier in the day, OilPrice.com reported that traders were pricing in a US-Iran settlement.
• The UK 10-year gilt yield fell 9.6 basis points to 5.152%, Investing.com data show, a day before the Bank of England's Nov 5 policy decision.

Session recap

European stocks posted broad gains on Wednesday, Nov 4, with every major benchmark up between 1.86% and 3.13% at the 16:30 UTC close. The STOXX 600 recovered from its 0.58% fall in the previous session, covered in our Nov 3 Europe brief. For context on other regions, see Asian and global market closes.

The table uses Yahoo Finance last-traded values at 16:30 UTC for indices, currencies and Brent. Official closing-auction levels published later can differ slightly; Investing.com, for example, showed the STOXX 600 at 658.64 after the session. The DAX traded as high as 26,541.64 during the day, according to Yahoo Finance.

Note: the Bund yield is shown as n/a because the two data providers we checked disagreed on its level. Investing.com showed 3.306%, down 0.12% on the day, while Trading Economics showed about 3.27%. Both pointed to a small decline. Currency changes are measured against Yahoo Finance's previous close. Brent is the January 2027 contract (code LCOF7 on Investing.com), compared with its Nov 3 settlement of $103.60. Brent settles at 19:30 UTC, so the $95.73 level is an intraday price. Investing.com showed $96.27 a few minutes later.

What drove it

US midterm results

Democrats won majorities in both the House and the Senate in Tuesday's US midterm elections. As of 10:05 CET (09:05 UTC), Euronews reported 228 House seats for Democrats, ten more than the 218 needed. It also reported that Democrats had taken seven Senate seats from Republicans. Dow Jones Newswires, via MarketScreener, said the result raised expectations of a check on executive-branch power. Trading Economics wrote that the new balance is expected to limit the administration's spending plans, and lower bond yields followed. Russ Mould of AJ Bell said "a divided government can create gridlock for policy changes," Dow Jones Newswires reported via MarketScreener.

Banks lead, defence and some tech lag

Lenders gained the most. In the morning, the Stoxx Europe Banks index was up 3.7%, with Deutsche Bank up 4.9% and UniCredit up 4.5%, Dow Jones Newswires reported via MarketScreener. The report described a rotation out of defence and technology into banks that had lagged this year. Euronews reported that defence names fell in early trade, including BAE Systems (down 5.2%), Hensoldt (down 4.9%) and Thales (down 4.5%). Trading Economics linked the defence weakness to expectations that Congress could restrain US military spending. By the close, Trading Economics listed Banco Santander up 4.77% and Allianz up 4.17% among the Euro Stoxx 50's best performers. It also listed Inditex up 5.27% and LVMH up 4.18%. ASML fell 3.60% and Schneider Electric fell 3.48%.

Renewable energy rally

Clean-energy shares rose on expectations of friendlier US policy. Investing.com reported that Vestas and Orsted gained between 5% and 7% early in the session, while Nordex surged 8% and SMA Solar 11.6%. The report also cited a rotation away from AI-linked stocks.

Oil slide and bond yields

At 9:40 a.m. ET (14:40 UTC), Brent was down 2.9% at $100.60, heading for a third straight loss, OilPrice.com reported. It said traders were "pricing a U.S.-Iran settlement" after Vice President JD Vance said the sides had made progress. An Iranian official said Tehran could reopen the Strait of Hormuz within two days if Washington met its demands. The cause of the further slide to $95.73 by 16:30 UTC has not been confirmed. Lower energy prices and falling yields supported equities. The gilt yield dropped to 5.152%, and Trading Economics linked the move to lower US Treasury yields after the vote.

UK company news

Smith & Nephew fell more than 2% after cutting its full-year revenue and profit guidance, Trading Economics reported, citing weaker orthopaedics growth.

What it means

Wednesday's session showed European investors treating a divided US government as reducing risk. Banks, consumer names and renewables gained, while defence and some chip stocks fell. The sharp drop in Brent also matters to oil-importing economies in Southeast Asia, whose markets reacted to the US vote earlier in the day, as covered in our look at US midterm results and ASEAN markets. Thursday's Bank of England decision is the next test for UK assets.

Political & policy watch

• Euro area inflation: Eurostat's flash estimate showed annual inflation rising to 4.0% in October from 3.8% in September. Energy inflation rose to 20.8% from 18.9%. Final data are due on Nov 18.
• Riksbank: Sweden's central bank raised its policy rate by 0.25 percentage points to 2%, effective Nov 11. It said a further increase in the coming year is likely if the outlook holds.
• Trade risk: James Smith of ING said, in comments reported by Euronews, that trade is a power the US president "can wield unilaterally without Congress." He did not rule out new tariffs on Europe.
• US-Iran: Reports of a draft deal remain unverified, OilPrice.com noted. The new US Congress is not seated until Jan 3.

What to watch next

• Nov 5: Bank of England policy announcement. Trading Economics said markets widely expect the first rate hike since 2023.
• Nov 18: Eurostat publishes full October inflation data for the euro area.
• Dec 16: Riksbank's next Monetary Policy Report.
• Dec 16–17: ECB Governing Council monetary policy meeting.
• Jan 3, 2027: The new US Congress is seated.

Risk checklist for readers

• Election-driven rallies can fade as investors shift from the headline result to the detail of policy, trade and budget negotiations.
• Oil is moving on diplomatic headlines. Unconfirmed reports about US-Iran talks can cause large swings in either direction within a single session.
• Central bank decisions, including the Bank of England on Nov 5, can move gilt yields, sterling and UK bank shares sharply.
• Index levels at 16:30 UTC can differ from official closing-auction values. Check the exchange or index provider for final figures.
• For investors outside Europe, euro and sterling moves change returns when converted back to their home currency.
• Sector rotation, such as from defence into banks, can reverse quickly and can affect concentrated portfolios more than broad indices.

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This article is for information only and is not investment advice.