November 4 News—Although stocks have historically tended to rise after U.S. midterm elections, Wall Street strategists are cautioning clients against excessive optimism this time around. Fundamentally, if Democrats expand their political influence, they may tighten federal and state-level regulation of the artificial intelligence industry, weighing on corporate earnings growth; persistently high interest rates also raise doubts about whether historical patterns can repeat. Further analysis shows that even if historical data suggest stocks usually rise in the year following midterm elections, the related performance is not uniformly positive. Data from Carson Investment Research indicate that since the early 1950s, when a Republican president was in office and Democrats controlled both chambers of Congress simultaneously, stock market performance has been among the weaker scenarios, with the S&P 500 rising only 4.9% per year on average; by contrast, when a Republican president was in office and Congress was controlled by different parties, market performance was usually stronger, with the S&P 500 rising 14% per year on average. Carson data also show that within the four-year presidential term cycle, midterm election years have historically been the years with the greatest market volatility, with an average maximum drawdown of nearly 18%.