Wall Street warns: Under a divided government, the 2027 debt ceiling showdown will test the "safe-haven myth" of U.S. Treasuries.

Zhitong Finance APP has learned that the U.S. midterm elections have concluded, with the Democratic Party unexpectedly winning control of Congress, and the market is ushering in the classic combination of a divided government. Historically, investors have tended to welcome this kind of political gridlockbecause it means policy will be constrained and spending will be restrained. On Wednesday, as news of the Democrats' landslide victory spread, the U.S. Treasury yield curve moved lower across the board, continuing this tradition. Data shows that since the mid-1990s, under a divided government, the 10-year U.S. Treasury yield has on average been at lower levels both one month and twelve months after the midterm elections.