The coming midterms could decide whether trillions in data center building goes ahead, and the worst outcome for stocks is a split Congress.

• Local governments control permits for a huge wave of data center projects worth close to $3 trillion, so the election sets the tone for whether that money gets spent.
• A Democratic sweep is seen as the best case for growth: it blocks new tariffs and more borrowing, which keeps government bond yields down, and it helps retail, restaurants, healthcare, and renewables.
• Republicans holding on means higher yields for longer as markets price in more tax cuts, more defense spending, and more debt, with defense stocks, banks, and nuclear power the winners.
• A narrow Democratic win in the House is the bad outcome: gridlock, more government shutdowns, and two years of fighting over data centers.
• If data center building slows, the big tech companies win anyway, because scarce computing power lets them charge more.

Outlook: Stocks usually rise in the year after a midterm, but another shutdown fight is likely in December if Congress ends up split.