"If you have a concentration of power, if it all goes to one party, then this party has the ability to do one thing and you have less checks and balances," Itay Goldstein, a professor of finance and economics at the University of Pennsylvania's Wharton School of Business, told ABC News."If it's divided, then you get more stability and more assurances that it's not going to go in any extreme way.
"The traditional take on politics in the market, whether it's justified or not, is that investors tend to embrace some degree of a divided government," Hamrick added."From a policy standpoint, that means it can be harder to get legislation through, but investors view that from the prism of being able to distance themselves from big changes in policy."
"That was a bit of a surprise," he noted."The prediction was that the Democrats were going to take both the House and the Senate, so seeing the divided government would be good from an investing perspective."