Global renewable energy stocks rally after Democratic sweep in U.S. midterms

 European renewable energy stocks rose Wednesday after Democrats won control of both the Senate and House in the U.S. midterm elections, with investors expecting the result to lead to more supportive renewable energy policy.

Denmark’s Vestas and Orsted gained between 5% and 7%, while Germany’s Nordex and SMA Solar surged 8 and 11.6%, respectively. Portugal’s EDP Renovaveis climbed about 4%, and France’s Voltalia gained nearly 6%. 

In U.S. premarket trading, First Solar rose roughly 8%, and Sunrun surged 8.6%. The gains followed similar moves in Asia, where South Korea’s Hanwha Solutions closed 18.6% higher, and HD Hyundai Energy Solutions and OCI Holdings gained 12.5% and 10.4%, respectively.

The gains come as investors hope a Democratic victory will bring stronger political support for renewables in the U.S. and ease political risk for the sector. Investors view a Democratic wave as favorable for the clean energy supply chain, including solar and batteries, at the expense of traditional energy. Renewable stocks are also benefiting from a rotation away from stocks tied to artificial intelligence.

On the flip side, defense stocks fell on the midterm results as the Democratic win raises the prospect of tighter scrutiny of military spending.