by Coinstrooper Crypto Articles
Quick Take
  • Nasdaq 100 futures fell nearly 1.5% as Democratic sweep odds hit 95%.
  • That sweep is the first of 3 conditions in Evercore ISI’s worst-case midterm scenario.
  • If they play out, Evercore’s worst case puts the S&P 500 at 6,800 by year-end.
  • That would erase nearly all of the index’s 2026 gains.

What Happened

West Texas Intermediate (WTI) crude traded near $94.40 a barrel on Wednesday. It would need to rise about 27% to cross Evercore’s $120 line. The US also reportedly struck Iran’s Qeshm Island on Monday. However, prices eased today as investors await the results of the US midterm elections.

Market Context

The S&P 500 has already lost about $500 billion in market value within 2 hours, The Kobeissi Letter said.

“The exception to ‘buy the dip’ is our view that, should ‘kinetic escalation’ with Iran drive [West Texas Intermediate crude oil] above $120/bbl for a prolonged period (a month or more) or should the oil price spike to the all-time high of $147/bbl, that an economic slowdown, credit widening and a longer and deeper market turndown would result,” the firm said.

Its base case, a divided Congress with an undisputed vote, holds at 7,750. In the bull case, Republicans keep both chambers, the vote goes undisputed, and Iran moves to negotiate. A sharp fall in oil prices would then lift the index to 8,400.

Still, CFRA’s Arun Sundaram calls a Democratic sweep the worst case for markets.

The firm also expects a Federal Reserve rate hike on December 9. It estimates the largest cloud companies must raise capital for $1.3 trillion in 2027 spending.

Why It Matters

Evercore ties the Iran risk to oil, which it calls the biggest threat to the economy.

The post Evercore Names the 3 Conditions That Could Wipe Out S&P 500’s Gains appeared first on BeInCrypto.

Details

Nasdaq 100 futures fell nearly 1.5% as Democratic sweep odds hit 95%. That sweep is the first of 3 conditions in Evercore ISI’s worst-case midterm scenario.

If they play out, Evercore’s worst case puts the S&P 500 at 6,800 by year-end. That would erase nearly all of the index’s 2026 gains.

Evercore’s Bear Case Needs More Than a Democratic Sweep

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Still, a sweep alone would not take the index to 6,800. Evercore’s report also requires a disputed result and military escalation in Iran before the new Congress sits in January.

Without that escalation, Evercore’s numbers change sharply, even under a Democratic Congress.

Without Escalation, Evercore Sees a Dip Worth Buying

The closest case to the worst one keeps the Democratic sweep and the disputed vote but drops the escalation. Evercore puts the S&P 500 at 7,650 there and calls any initial decline a buying opportunity.

That 850-point gap is the cost Evercore assigns to escalation.

A Democratic Congress would still face the White House. Trump told CBS News on Tuesday, before polls closed, that he would veto Democratic bills if necessary.

History offers 3 precedents for a Democratic Congress under a Republican president. The 1986, 1990, and 2006 midterms each produced that split. The S&P 500 averaged a 10.9% gain the following year, BeInCrypto reported.

Evercore, for its part, keeps its preferred portfolio focused on AI. It remains overweight information technology, communication services, and consumer discretionary stocks.

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