After years of gridlock in the Senate over key business issues, it seems Wall Street and the business community is quiet pleased with the outcome of the midterm elections last night. The GOP took control of the Senate and build on its gains in the Congress which is being seen as a huge positive. Many analysts now believe that the election results would mean an overhaul in the tax system, some relaxation in the financial regulations and environmental norm both seen as huge policy hurdles by the business community.
Business houses are even more enthused about the fact that they would have a more receptive audience as the Republicans are front-runners to take control of both the Congress and the Senate. It is also believed that the new Republican controlled Senate would allow business houses to go ahead with forging strong ties between Asia and Europe and emerging markets like India.
Many lobbyists and analysts believe that the first action taken by the Republicans could be repealing the Affordable Care Act and the Dodd Frank banking regulations as both of these were the cornerstones for many Republican candidates for their campaigns. Also, regulations with regards to minimum wages and student loans seem to be things that the Republican controlled Senate could bring to the fore.
The Dow Jones Industrial Average was higher in trade today on the back of the election results as investors believe that the policy lockjam could now be a thing of the past. The dollar was also higher against all major currencies showing the traders faith in the new Republican controlled Senate. Also, the slew of economic reports which showed a strengthening US labour market and an increase in personal spending are being seen as good reasons for the current rally in the markets.