Treasury yields fall as investors crowd into bonds for safety amid election stock sell-off

Treasury yields fell as investors moved into government bonds for safety after Democrats won control of both chambers of Congress and markets reacted to the election result. The shift matters because a divided government could constrain the Trump administration’s spending plans and make it harder to pass legislation, potentially easing concerns about the US deficit.

Democrats flipped Senate seats in Iowa, Kansas, North Carolina, Ohio, South Carolina, Maine and Texas, and won the governor’s races in Ohio and Texas. JPMorgan traders said investors were watching for reduced deficit spending, while BondBloxx’s JoAnne Bianco said tighter limits on spending could improve the fiscal outlook. Oil also fell: US West Texas Intermediate dropped 8.29% to $88.12 a barrel, and Brent declined 8.67% to $94.62.