European equity indices traded broadly higher on Wednesday morning, 4 November, after Democrats secured control of both chambers of the US Congress in the midterm elections, with renewable energy stocks among the standout performers.

The Stoxx 600 benchmark index was up 0.51% at 648.95 points at the time of writing.

Across the region’s major exchanges, Germany’s DAX rose 0.46%, France’s CAC-40 advanced 0.50%, Spain’s Ibex gained 1.39%, Italy’s FTSEMIB added 1.17%, the UK’s FTSE 100 edged up 0.05%, and the Netherlands’ AEX traded 0.59% higher.

By sector, banking (+2.32%) and natural resources (+1.95%) led the gains, while defence (-1.72%) and industrials (-0.44%) recorded the steepest losses.

The Democrats’ emphatic victory in the US midterms was widely seen as a repudiation of President Donald Trump, reflecting broad voter dissatisfaction with the economy and the ongoing conflict in Iran.

European equities had already outperformed their US counterparts in the month leading up to the midterm vote, as investors rotated out of artificial intelligence-linked stocks and into more defensive sectors.

Investor attention is now turning to the outlook for the war in Iran and potential policy shifts that could affect the technology sector.

“The midterm and presidential elections [in the United States] are becoming more important to us, in Europe, than they have ever been,” Michael Field, Morningstar’s chief equity analyst, told Bloomberg. “The split between Congress and the President should prevent the adoption of large-scale measures, which I ultimately view as positive for the economy and for companies,” he added.

Among notable market moves, wind farm operator Orsted surged more than 7% and Vestas Wind Systems jumped over 4%, both reacting to the Democratic victory, which is seen as favourable for companies across the clean energy supply chain. European bourses were also lifted by gains in Novo Nordisk, which at one point rose 6.6% after raising its earnings guidance. The Danish pharmaceutical group was trading up more than 3% at the time of writing.