US 2018 midterm election preview - Nomura

Analysts at Nomura explained that the Democrats appear poised to take the House but they expect little impact on the outlook.

Key Quotes:

"With roughly two months left before the 2018 midterms, it appears increasingly likely that Democrats will gain control of the House of Representatives while the Senate remains in Republican hands."

"We expect this situation to result in little substantive legislation moving through Congress while lawmakers manage to avert material disruptions from fiscal policy (e.g., failing to raise the FY20 spending caps)."

"While a Democratic House may vote to impeach President Trump, we think conviction in the Senate, requiring a two-thirds majority, is unlikely."

"However, if Democrats gain control in the House they will likely pursue a series of investigations into the Trump administration that would generate additional headline risk and consequently dampen the likelihood of any serious bipartisanship."

"Finally, the last section of our preview includes a list of resources to monitor leading up to November."