Sweep, a Disputed Vote and $120 Oil: Evercore's S&P 500 Worst Case

Nasdaq 100 futures sank close to 1.5% as the odds of a Democratic sweep climbed to 95%. The S&P 500 shed roughly $500 billion in market value in just two hours, according to The Kobeissi Letter. Evercore ISI says that selloff is only the opening act — the sweep is the first of three conditions in its worst-case midterm map.

The other two: a disputed election result and a military escalation with Iran before the new Congress sits in January. Stack all three, and Evercore's worst case drags the S&P 500 down to 6,800 by year-end — wiping out nearly everything the index gained in 2026.

Oil is the hinge. Evercore calls crude the biggest threat to the economy, warning that WTI holding above $120 a barrel for a month or more — or spiking to its $147 all-time high — would bring an economic slowdown, wider credit spreads and a longer, deeper market slump. WTI traded near $94.40 on Wednesday, so it needs to climb about 27% to reach that $120 line. The US reportedly struck Iran's Qeshm Island on Monday, though prices eased as investors waited on the vote.

Strip out the Iran escalation and Evercore's math shifts fast. Keep the sweep and the disputed vote but drop the military risk, and the firm sees 7,650 — with any early dip labeled a buying opportunity. That 850-point gap is the price tag Evercore assigns to escalation. Its base case, a divided Congress with a clean vote, holds at 7,750, while Republicans keeping both chambers plus an undisputed result and a negotiating Iran lift the index to 8,400.

Washington noise is already loud. Trump told CBS News on Tuesday, before polls closed, that he would veto Democratic bills if needed. History isn't so grim: the 1986, 1990 and 2006 midterms each handed Congress to Democrats under a Republican president, and the S&P 500 averaged a 10.9% gain the following year, per BeInCrypto. CFRA's Arun Sundaram still calls a Democratic sweep the worst case for markets.

Evercore isn't hiding where it wants to be. The firm stays overweight information technology, communication services and consumer discretionary, with its preferred portfolio built around AI. It also expects a Federal Reserve rate hike on December 9 and estimates the largest cloud companies must raise capital for $1.3 trillion in 2027 spending.