NEW YORK – As Americans voted in Tuesday's midterm elections, the U.S. business and financial communities appeared to be cheering for a split Congress and the resulting legislative gridlock on Capitol Hill.
"Gridlock is good, Wall Street doesn't like change," said Charles Gabriel, senior Washington analyst for Prudential Securities. "You're not going to have runaway spending increases, you won't have a repeal of the Bush tax cuts, and there's no legislative change that will roil industries. The green light is on for equity investments because you've got protection against any major changes."
Generally, the Republican Party is regarded as more business-friendly because of its tax policies and softer stance for requirements on corporate governance. After 12 years of a Republican majority in the House, four years of GOP control in the Senate and six years for Republican President George W. Bush in the White House, much of the law enacted in Washington has had a pro-business bend.
However, the prospect of Democrats controlling one chamber and Republicans another puts the president in a lame-duck twilight for the last two years of his term and leads directly to the possibility of gridlock in Washington D.C. That is, a government unable to legislate much in any direction, such that the status quo is likely to remain.
Many in business and on Wall Street seem to think that wouldn't be such a bad thing.
On Tuesday, optimism was evident on Wall Street where stocks had their second consecutive strong day. The Dow Jones industrial average touched a new intra-day record high while gaining 51.22 points, the Standard & Poor's 500 index rising 3.06, and the Nasdaq composite index adding 9.93 points.
Some evidence also suggests that, at least from the market's perspective, the political slant of Congress following an election is less important than the election itself. According to data from the Stock Trader's Almanac, the Dow Jones industrial average rises an average of 10.6 percent during the year after a midterm election, regardless of the victorious party.
FOX News' Rebecca Gomez and the Associated Press contributed to this report.