US stock futures dip as investors await midterm election results

SINGAPORE: US stock futures slid and the dollar softened on Wednesday as investors awaited results from the US midterm elections, with the focus on whether Democrats can wrest control of Congress from President Donald Trump's Republicans.

Democrat Jon Ossoff won re-election in Georgia, marking the first significant race call of the night as polls closed in seven states.

Democrats are favoured to capture the House of Representatives, while both parties are locked in an intense state-by-state battle for the Senate, leaving investors and markets on edge.

"For traders, the distinction between a narrow Democratic majority and a commanding victory is critical," said Chris Weston, head of research at Pepperstone. "A narrow blue wave may be largely priced in."

In the US Senate, where at least nine races are considered competitive, Democrats won the first of 35 seats up for grabs on Tuesday, with US Senator Mark Warner winning re-election in Virginia as expected. Democrats need to gain four seats to win control of the chamber.

Weston said the greatest market reaction may come not from who wins Congress, but from how decisively they win and how far the result deviates from expectations.

Futures for the S&P 500 fell 0.5 per cent, while Nasdaq futures declined 0.9 per cent.

Asian markets edged higher as battered technology stocks found favour after strong results from chipmaker AMD eased some concerns over the durability of the artificial intelligence trade.

MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.4 per cent, led by South Korean stocks, which rose more than two per cent in early trading. Japan's Nikkei fell 1.5 per cent after returning from a holiday.

AMD forecast faster-than-expected growth in 2027 as its data centre sales surged and its multibillion-dollar challenge to Nvidia gathered pace.

The forecast and better-than-expected third-quarter results offered a strong counterpoint to mounting fears that the AI boom was losing steam, easing investor concerns after rival Intel issued a weak outlook last week.

In the oil market, prices were volatile on Wednesday after falling to a four-week low in the previous session, as investors weighed talks to end the wars in Ukraine and Iran against concerns that recent attacks in both conflicts could further disrupt supplies.

The effective blockade of the critical Strait of Hormuz, which links the Gulf to global markets and previously served as a conduit for 20 per cent of global oil supplies, has redrawn energy flows, stoked inflation concerns and upended the global interest rate outlook.