There’s no two ways about it: Yesterday’s midterm election results were nothing short of a massive victory for the Democrats (a “blue tsunami,” indeed). The Democrats will now control both chambers of Congress by a wide margin, radically altering the balance of power in Washington.

While change brings uncertainty—and no one likes uncertainty less than investors—stock markets have so far reacted positively to the news.

As of the time of this writing, S&P futures are up more than 1%, Dow futures are up more than 1.4%, and the tech-heavy Nasdaq futures are up nearly 1%.

But while many stocks are trending up this morning, two of the biggest ones, Elon Musk’s SpaceX (Nasdaq: SPCX) and Tesla (Nasdaq: TSLA), are down significantly in premarket trading.

And yes, the election results are likely the biggest reason for their fall. Here’s what you need to know.

As of the time of this writing, shares in Elon Musk’s two public companies, Tesla and SpaceX, are down by notable percentages.

TSLA shares are currently down around 5.5% in premarket trading, with SPCX shares down more than 5.5% as well. 

To put those numbers into perspective, the broader Nasdaq, where Tesla and SpaceX trade, is up nearly 1%.

And other Big Tech contemporaries of Musk’s public companies are also seeing green, including Alphabet, Amazon, Apple, Microsoft, Nvidia, and Meta.

So if most of Big Tech is up on the midterm results, why are Musk’s companies down significantly?

The short answer is that investors are likely worried that a Democratic-controlled Congress could make things harder for Musk’s companies going forward, mainly through extra scrutiny on Musk’s business empire and the companies’ existing government contracts.

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