Tesla and SpaceX shares drop after Democrats win 2026 midterms

Market reaction after the election

Yahoo Finance reports that shares tied to Elon Musk’s companies fell after Democrats won the 2026 midterm elections on Tuesday, November 3. The following morning, according to The New York Times, Tesla’s stock was down more than 5% at the open, while SpaceX fell by more than 7% before recovering some of the decline.

Musk’s spending in the midterms

The report says Musk, 55, spent at least $474 million to try to keep Republicans in power. The New York Times said that amount was more than any other donor gave in a U.S. election cycle, not counting candidates who financed their own campaigns. Yahoo Finance also reports that Musk put $224 million into Texas races, where both companies are headquartered and where he lives.

Texas races and possible business impact

According to the report, Musk supported Ken Paxton’s Senate bid, but Democrat James Talarico won the seat. Democrats also won the governorship with Gina Hinojosa, while Nathan Johnson and Vikki Goodwin were elected attorney general and lieutenant governor, respectively. The New York Times said Tesla and SpaceX are trying to build a $100 billion chip manufacturing plant in Texas, and that Democratic control could affect those plans.

Reaction from Musk and Democrats

Musk posted on X on Wednesday morning, “Data centers in space looking pretty appealing right now,” according to the article. The report also says SpaceX and Tesla are exploring a merger, and that a Democrat-controlled Congress could raise questions about it, since some lawmakers have said they want to investigate Musk and his companies. Democratic Massachusetts Sen. Edward J. Markey responded to a post on X about live televised trials of Big Tech executives by writing that they would need new forests for the subpoenas, according to Yahoo Finance.