The US Midterm Campaign Trends Ken Fisher Is Watching

Ken Fisher opens by framing the midterm election environment as heading into an 'ugly fall,' which he notes is typical for midterm cycles. He identifies the Republican Party's core structural problem: very thin margins in both the House and Senate. While redistricting has helped Republicans somewhat, even a below-average anti-incumbent wave would be enough to hand the House to Democrats. Fisher also flags President Trump's low approval ratings as a significant liability, noting these levels have historically always resulted in the president's party taking significant midterm losses — though he acknowledges Trump has surprised skeptics before, including with his 2024 reelection.

On the fundraising front, Fisher notes that Republicans have narrowed the traditional Democratic financial advantage, which he sees as a meaningful tailwind for the GOP. He also points out that presidential approval polling on sites like Real Clear Politics tends to skew more negative than actual election outcomes, so while the trend matters, the absolute numbers should be taken with caution.

For the Democratic Party, Fisher identifies a different but equally serious problem: an inability to coalesce around a positive, forward-looking message. While anti-Trump sentiment has juice with independents, Fisher argues Democrats would be stronger with a concrete 'here's what we'll do for you' platform — similar to what Republicans lacked as well, given that many GOP officeholders are reluctant to diverge from Trump's messaging. He contrasts this with historical examples like Newt Gingrich's 1994 'Contract with America' and Kevin McCarthy's more recent programmatic approach.

Fisher then walks through specific Senate races that could determine majority control. He highlights North Carolina (open seat, leans Democrat after Thom Tillis retirement), Ohio (Sherrod Brown vs. Jon Husted as competitive), Maine (Susan Collins as a perennial Republican survivor), Alaska (complicated by ranked-choice voting), and Texas (a potentially bruising Republican primary between John Cornyn and Ken Paxton that could leave the winner vulnerable). He notes Republicans may pick up seats in states like Michigan to offset losses elsewhere.

Fisher closes by tying the election outlook to market implications. He argues that midterm elections historically produce gridlock, which markets tend to favor, and that this cycle is unlikely to dramatically change that dynamic regardless of which party gains seats. He expects continued gridlock to be a net positive for stocks, as neither party will have the power to make large, radical legislative moves.