~5 minute read
By Tim Russell, CFP® (President & Wealth Manager) & Stephen Rohrer, CES™ (Wealth Manager) at Life Financial Group
Originally shared on the Life in the Markets podcast — 11/9/2026
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*Note: you will get the most out of this market update by watching the video above*
A Volatile Week on Wall Street
The midterm results dominated the headlines last week, and the stock market felt it. Volatility surged, with the VIX (Wall Street’s “fear gauge”) jumping to levels we haven’t seen since the tariff tantrum and other major market events. That doesn’t necessarily mean we’re heading back into crisis mode, but it’s worth paying attention to.
In this week’s episode of Life in the Markets, Stephen and Tim share their thoughts on the election, what it may mean for the economy and your investments, and why, as believers, our ultimate hope was never on the ballot.
The Weekly Market Recap
Technology-heavy stocks took the biggest hit. The Nasdaq fell 4.91% for the week, while the S&P 500 dropped 2.68% to close at $7,376.86. The equal-weight S&P 500 held up better, slipping only 1.04%, a sign that the selling was concentrated in the largest names. Small caps (Russell 2000) fell 2.11%, and international stocks (EFA) dipped 1.43%.
Outside of stocks, precious metals rallied, with gold up 4.91% and silver up 5.69%. Oil fell sharply, down 12.08% to $90.50, and Bitcoin slid 2.44%. Bonds were roughly flat, and the 10-year Treasury yield eased to 4.86%.
Even after the pullback, the S&P 500 is still up 7.76% year to date and the Nasdaq is up 11.30%.
What the Midterm Results Told Us
Democrats made large gains this election. Even so, many of the winners were moderate Democrats rather than candidates from the far left, which makes us believe less of the most progressive agenda will actually be enacted. We also expect President Trump to veto any far-left bills that reach his desk. At the time of recording, Senate races in Mississippi and Alaska were still too close to call, and several House races may take another week or two to settle.
Vice President JD Vance offered a candid, data-driven look at what went wrong. He pointed to the Iran war as the main reason Republicans lost ground, largely because it fed the next concern on voters’ minds: the cost of living. As James Carville famously put it in 1992, “It’s the economy, stupid.” Voters also said they want leaders who put American citizens first.
There were bright spots on the statewide ballot measures:
- California voters rejected a new “billionaire tax.” Proposition 40, a one-time 5% tax on billionaires’ net worth, appears headed for defeat. It’s encouraging for our free-market system that even California voters resisted the pull of envy toward those who have more.
- Property tax relief passed. Florida voters approved one of the largest property tax cuts in the state’s history, and Georgia expanded a land-based tax exemption. That matters for everyone from first-time home buyers to retirees on fixed incomes.
- Election integrity measures advanced. Five states approved measures affirming that only U.S. citizens can vote, and Nevada, North Carolina, and Ohio added voter ID requirements.
- Girls’ sports were protected. Voters in Arizona, Colorado, Nebraska, and even Washington state approved measures requiring students to play on teams based on biological sex.
Unfortunately, Nevada and Virginia passed measures enshrining abortion in their state constitutions. Idaho, on the other hand, rejected an effort to overturn its pro-life protections.
Why AI Stocks Sold Off After the Election
One of the biggest drivers of the stock market over the past several years has been the anticipated economic impact of artificial intelligence. After the Democratic gains, the market put some of that expectation on hold, and AI-related stocks sold off. That helps explain why the Nasdaq fell nearly twice as much as the broader market.
Why would the market read the election as negative for AI? Many Democratic state and local candidates ran on platforms opposing new data centers. That message was popular with both Republican and Democratic voters, but Democrats were the ones campaigning on it.
As we’ve discussed in previous episodes, data centers have real downsides that need to be addressed, such as driving up electricity rates for nearby communities. We believe those problems can be solved, and local pushback is a good way to get them addressed. It could even be a blessing in disguise for the hyperscalers, forcing them to tap the brakes on their massive capital spending.
Midterm Results and the Stock Market: What History Suggests
Historically, the stock market has done fairly well in a mixed environment, where Democrats control some centers of power and Republicans control others. Gridlock tends to mean fewer sweeping policy changes, and less change means less uncertainty for businesses and investors.
As we noted in an earlier episode, First Trust data going back to 1950 shows that the S&P 500 has averaged an 18.8% return in the 12 months following a midterm election. Market volatility has also tended to decline in the year after the midterms.
Of course, past performance is no guarantee of future results, and the year ahead may bring situations history can’t account for. But it’s a helpful reminder not to let election headlines push you off course. For most investors, staying disciplined and invested remains the wisest path.
The Pendulum Swings: Where Our Hope Really Lies
If you’re discouraged by the midterm results, remember this: God is still on the throne. He is working out His good plans for mankind, for America, and for the consummation of all things to the glory of His name. However you feel about the election, He is still good and worthy of our worship and praise.
Politics and elections matter, and believers should engage in them. But our ultimate hope is not in the ballot box or in politicians. If this election shows us anything, it’s that politics flows out of culture, and our culture has largely rejected God.
Election cycles tend to swing like a pendulum, from left to right and back again. Be patient; a swing in the other direction will likely come. Some of the newly elected candidates are openly socialist, and we believe their wins may serve as a wake-up call. The more radical, anti-God, and anti-free-market ideas are exposed, the more voters will turn out for sound economic policy.
Still, both the right and the left need to abandon arrogance and pursue truth and virtue. Politics cannot change the human heart; that is the work of the church. So pray for our nation: that we return to righteousness, that we value life and the image of God in every person, and that we uphold just and righteous laws.
As John Adams wrote:
“We have no Government armed with Power capable of contending with human Passions unbridled by morality and Religion. Avarice, Ambition, Revenge or Gallantry, would break the strongest Cords of our Constitution as a Whale goes through a Net. Our Constitution was made only for a moral and religious People. It is wholly inadequate to the government of any other.”
Verse of the Week: Psalm 2
Psalm 2 opens by asking why the nations rage and the peoples plot in vain. The rulers of the earth set themselves against the Lord, yet “He who sits in the heavens laughs” (Psalm 2:4, ESV). God has already set His King on Zion. The psalm closes with a call to serve the Lord with reverence and a promise: “Blessed are all who take refuge in him” (Psalm 2:12, ESV).
Whatever the next election brings, that refuge doesn’t change. Steward your resources faithfully, stay the course, and keep your eyes on the One who holds the nations in His hand.
Have questions about what this means for your own plan? Reach out to our team, we’re glad to talk it through.
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Have questions or topics you’d like us to cover in a future episode? Email us at contact@thelifegroup.org with “Life in the Markets” in the subject line.
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Disclaimer: The topics discussed here are for informational purposes only and do not constitute specific investment advice. Investing involves risks, including potential loss of principal. Past performance does not guarantee future results. Securities and advisory services offered through Geneos Wealth Management, member FINRA/SIPC.
