Democrats seized control of both houses of Congress in Tuesday’s midterm elections, a historic upset that rebuked President Donald Trump. According to UPI, the party flipped Senate and House seats in solid Republican states as voters rejected the administration’s agenda.

Two Senate seats in Mississippi and Alaska remain uncounted, and 68 House races are incomplete. President Donald Trump conceded the defeat, telling Fox News he was surprised by the result but credited Democrats, saying they “did a good job.”

Senate Democratic leader Chuck Schumer and House Democratic leader Hakeem Jeffries declared victory Wednesday, with Senate Democrats leading 54-44 and House Democrats leading 237-139, according to UPI.

Jeffries, who is likely to become speaker, said the election was a mandate for change. “This is a change election and we understand as House Democrats that we need to deliver dramatic change. Things are broken,” he said, according to UPI. He added, “The days of the House of Representatives functioning like a wholly-owned subsidiary of the Trump administration are over.”

Schumer said Democrats won the Senate “against all odds,” according to UPI, and that their message to voters was “relief is on the way.” Democrats flipped Senate and House seats in solid Republican states including South Carolina, Ohio, Texas, and Kansas, according to UPI. The party’s victory in South Carolina marked its first Senate win in that state since the turn of the century, with Democrat Annie Andrews projected to defeat Republican Sen. Darline Graham.

Trump said he “felt badly” for Graham, according to UPI. He raised the possibility of wielding veto powers, predicting Democrats would send over “things that are insane” that he would veto before later negotiating. He insisted the outcome would have differed had he been on the ballot and ruled out a Cabinet reshuffle, saying, “I would have done nothing different.”

Vice President JD Vance broke with Trump, blaming the losses on the Iran war, which started in February. “Everyone knows why we lost,” Vance wrote on X, according to UPI. He cited a pollster’s four ways to win back voters: “end the war; focus on cost of living/inflation; Put America First; Change our relationship to Israel.” Trump said he supports Vance’s post but would not change his actions regarding the war, which he defended.

Markets rallied on the decisive results. The Dow surged 1,569 points, or 3%, its best post-midterm elections day since 1982, according to CNN. The S&P 500 rose 1.58% and the Nasdaq Composite rose 1.44%. Stock futures initially fell Tuesday night before erasing losses and gaining overnight as investors embraced certainty and Trump’s acceptance, CNN reported. Oil prices dropped sharply, with Brent crude falling almost 8.7% to settle at $94.62 per barrel, its lowest since Aug. 31. The VIX, which measures volatility expectations, sank almost 20%, and the dollar weakened against major currencies.

Analysts said a divided government could curb excess spending. Deutsche Bank’s George Saravelos said it should “act as a break on extreme policy outcomes,” according to CNN. Charu Chanana of Saxo said a Democratic-controlled Congress would constrain Trump’s legislative agenda on taxes, fiscal stimulus, and spending, but noted Trump retains veto power.

Bob McNally of Rapidan Energy Group cautioned against betting on a quick end to the war. “Traders are betting that the administration is going to quit this war… We’re not buying it. We think escalation is more likely,” he told CNN. Vance’s comment that “the reason we lost is the war” accelerated oil price declines, CNN reported.

Democrat wins in states like Texas raised questions about potential restrictions on AI data center buildout, according to CNN. Nvidia fell 3%, an AI infrastructure ETF dropped 9%, and shares of CoreWeave and Nebius sank roughly 10% and 6.7%, respectively. Tesla and SpaceX shares fell about 3.3% and 3.9%; Musk has made Texas home for his companies, and Democrat victories cast uncertainty over his relationship with the state, CNN reported. CVS Health shares dropped 12.5% after announcing it would split into two companies.

Jeffries vowed House Democrats would work to revive the American dream of affordable life, housing, health care, education, and retirement for “every single person in this land,” according to UPI. He said, “The wealthy, the well-off, and the well-connected tried to buy this election. The American people have responded in a resounding way and made clear that America is not for sale.” Democrats pledged to quickly check Trump in Congress and investigate him. The new Democrat-controlled Congress will be sworn in Jan. 3.