Midterm Elections a Watershed for AI Bull Market? BofA's Hartnett: If Republicans Hold Senate, AI Stocks Could 'Rally' into 2027

BofA's Hartnett noted that the 2026 midterm elections are a key watershed for the U.S. stock market's AI bull run. If Republicans hold the Senate and Texas Governor Abbott is re-elected, AI capital expenditure will continue, and U.S. stocks, especially the AI sector, could 'rally' into 2027; otherwise, the market could drop by more than 10%. Currently, earnings and AI investment support the bulls, but positioning is extremely crowded, and surging bond yields pose a major risk.