Lockheed Martin gets about 70% of its sales from the U.S. government. Medicaid accounts for three-quarters of Molina Healthcare’s premium revenue. Coinbase is waiting on Congress to finish writing the rules for cryptocurrency.

For some of the biggest U.S. companies, Washington is part of the business model. Now, the midterm election could change who holds the leverage.

A Democratic victory in either or both chambers of Congress would grant the party new leverage to investigate companies, challenge federal spending and demand legislative concessions. But their reach would have limits: President Donald Trump would retain his veto and broad authority over tariffs, immigration and federal regulation.

Historically, stocks have performed well under divided government. Under Republican presidents, the S&P 500 has gained an average of 23% in the year after midterms when Congress was split, compared with 16% when Democrats controlled both chambers, according to a Morgan Stanley analysis published Thursday. Analysts often attribute the pattern in part to congressional gridlock limiting sweeping policy changes.

Still, some analysts caution against assuming that pattern will repeat.

“We don’t think that blueprint holds up this time around, and we still see plenty of reasons to be constructive on the U.S. equity market,” said Ariana Salvatore, head of U.S. public policy research at Morgan Stanley.

For investors, the midterm election could reshape which businesses preserve their advantages in Washington, particularly in industries such as defense, healthcare, banking and artificial intelligence.

“There are some policy changes that might be market moving, at least for certain segments,” said Jeff Buchbinder, chief equity strategist at LPL Financial.

On Oct. 21, Sen. Richard Blumenthal, D-Conn., the top Democrat on the Senate Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations, sought records tied to Trump’s White House ballroom from donors including Cisco, Salesforce, ServiceNow and Kraken. Apple and Nvidia each committed $25 million to the project, according to records obtained by The Washington Post.

Rep. Jamie Raskin, D-Md., has separately sought records involving tariff exclusions, including communications involving Apple’s former CEO Tim Cook, as Democrats investigate whether Trump used trade policy to reward political allies and donors.

While donations do not prove wrongdoing or favorable treatment, congressional probes still carry risks: subpoenas consume executive bandwidth, reveal internal communications and generate unpredictable news coverage. Few CEOs relish the idea of sitting at a witness table before lawmakers and television cameras.

“It creates volatility because you get a negative headline,” said Monica Guerra, Morgan Stanley’s head of policy and geopolitical strategy, who expects Democrats to cast a wide net for their probes.

Democrats have signaled interest in Trump family businesses, government contractors, firms tied to Donald Trump Jr.’s 1789 Capital and companies associated with Elon Musk and DOGE.

Trump’s 2025 tax cuts and spending law, known as One Big Beautiful Bill, is projected to reduce federal Medicaid spending by $911 billion through 2034, according to a KFF analysis of Congressional Budget Office estimates. KFF is a nonpartisan nonprofit that provides health policy information. Meanwhile, new work requirements for Medicaid enrollees are scheduled to take effect Jan. 1, or earlier in some states, while tighter state budgets could mean fewer are people covered and greater pressure on provider payments.

Molina Healthcare generated $32.2 billion, or 75% of its 2025 premium revenue, from Medicaid, according to the company’s annual SEC filing. In the same filing, Molina warned that losing government contracts or failing to renew them on favorable terms could materially reduce premium revenue.

A Democratic-controlled chamber could not repeal the 2025 law on its own but could use must-pass budget negotiations to seek funding changes or delays to some cuts.

“They’re probably going to push back on those Medicaid cuts,” Buchbinder told CNBC, noting that preserving coverage could help stabilize enrollment for Medicaid insurers and patient volumes for hospitals.

Hospitals face their own squeeze: fewer insured patients can mean more uncompensated care, while state budget pressure can reduce reimbursement rates, according to KFF. Congress created a $50 billion rural health fund over five years to cushion some of the blow, but KFF and medical providers have said the money would not fully offset the broader Medicaid reductions.

Democratic gains could still cut both ways for healthcare. The same lawmakers seeking to protect Medicaid funding could also intensify scrutiny of insurers, hospitals and drugmakers over prices, coverage and profits.

Defense contractors face a fight over which weapons and programs Congress keeps funding. The White House has requested $1.5 trillion for national defense in fiscal 2027, with a focus on replenishing weapons, bolstering readiness and covering other needs, some tied to the Iran war.

The White House has requested $1.5 trillion for national defense in fiscal 2027, while separately seeking an $87.6 billion supplemental appropriation from Congress for fiscal 2026, driven primarily by military operations related to Iran.

A Democratic Congress could challenge some Iran- and Israel-related spending while pushing for more aid to Ukraine. However, bipartisan consensus on China deterrence, nuclear modernization and missile defense could protect other major programs, according to multiple analysts.

For contractors, the difference could mean billions of dollars in orders.

Lockheed Martin, for example, recently reached a framework agreement with the Pentagon covering 850 F-35 fighter jets over a decade. But the agreement is not yet a finalized contract: Congress must authorize the multiyear purchase and provide the funding.

“You want to be a stock picker and not just ride the whole sector,” Guerra told CNBC, pointing to areas such as shipbuilding, autonomous systems and missile defense as likely winners.

For crypto companies, the midterms could determine whether Trump’s regulatory shift becomes durable law or remains vulnerable to the next administration. The industry’s push for permanence stalled in September, when the Senate failed to advance the Trump-backed Clarity Act, a sweeping market-structure bill.

Shares of Coinbase and stablecoin issuer Circle fell as much as 11% when the measure failed.

Getting a bill through the next Congress could come at a price. Democratic gains would give the party more leverage to demand stricter consumer safeguards, limits on yield-bearing stablecoins and tighter scrutiny of Trump’s crypto businesses.

“In some ways, the industry doesn’t really care who got elected,” said Sam Stovall, chief investment strategist at CFRA Research. “They just want to know what the rules are going to be for the coming year.”

Banks are looking for durability, too.

Federal regulators estimate their proposed capital overhaul would cut requirements for the largest banks by roughly 4.8%, potentially freeing billions for lending and shareholder payouts. The Federal Reserve writes the rules, but Senate control shapes who fills future vacancies, and congressional committees can pressure regulators through hearings and investigations.

“It’s at the regulatory level where stuff can happen that matters,” Buchbinder said.

AI may be the messiest political trade of all.

Trump has made rapid data-center construction an economic and national-security priority. Morgan Stanley expects hyperscalers including Microsoft, Amazon, Alphabet and Meta to spend more than $1 trillion on capital projects in 2027, even as the build-out faces growing backlash over electricity bills, water use and infrastructure costs.

CNBC’s All-America Economic Survey from October found that 63% of registered voters oppose having a data center within 10 miles of their home, compared with just 13% who support one. The level of opposition is higher from Democrats than Republicans.

That friction has already reached Congress. In September, the House voted 417-3 to require state regulators to consider making large data centers cover the additional electricity infrastructure costs needed to serve them. The measure stalled in the Senate, 57-43 on a procedural vote, after Democrats argued it was too weak and pushed for mandatory protections instead of trusting the industry to police itself.

The midterms therefore could decide who gets the power. Democratic gains could put more grid-upgrade costs on tech developers, raising project costs just as access to power is constraining new construction.

But Congress is only part of the equation. State regulators, utilities and local governments will still decide where projects connect to the grid and which facilities get built.

“We think the election can have meaningful consequences, but on a highly localized basis,” Salvatore said.