A likely Democratic sweep in the midterms could trigger near-term stock market volatility followed by a strong rally, which is bullish for investors willing to stomach short-term swings.

• Prediction markets and early voting data point to Democrats winning both the House and Senate, the outcome least expected given how high stocks have climbed under Trump.
• Trump's approval rating has dropped to its lowest level of any president since 1946, driven by inflation, high gas and housing costs, and unease over tariffs and the Iran conflict.
• A Democratic sweep would create political gridlock, since the Senate filibuster and Trump's veto power would block most new legislation from either party.
• Gridlock usually lowers "uncertainty," and lower uncertainty has historically been a major fuel for stock market rallies after midterm elections, averaging gains of about 14% in the following 6 to 12 months.
• Government deficits and dollar debasement are expected to stay high regardless of who controls Congress, continuing to push stock market earnings higher over time.

Outlook: Expect some short-term market turbulence around the election, followed by a likely rally into year-end as political uncertainty fades.