NASDAQ futures sank 2% on Wednesday on prospects of Democrats gaining control of the Senate. Investors are concerned that a Democratic-led House would pile pressure for tighter regulations on technology mega-caps.
- Speculations intensified after Democrat Raphael Warnock won a hotly contested Senate race in Georgia, while Democrat Jon Ossoff held a narrow lead over incumbent Republican David Perdue in the other race.
- A “blue wave” would allow President-elect Joe Biden to act on his reforms, including a new COVID-19 stimulus, higher corporate taxes, and more regulations for tech giants
- Big Tech stocks dropped between 2.2% and 3.2% in premarket trading except for Tesla, which continued its upside rally.
- Despite the stock tumble for large tech, clean energy stocks gained with Invesco Solar ETF up about 5% on speculations they will benefit under a Democrat-led house
- Bets on the decriminalization of marijuana at the federal level similarly lifted ETFMG Alternative Harvest ETF up 8.4%.
Big tech stocks are currently declining. AAPL: NASDAQ is down 1.70% on premarket, FB: NASDAQ is down 2.39% on premarket, GOOGL: NASDAQ is down 1.90% on premarket