U.S. stock futures were slightly down and other markets were mixed as the dollar weakened on Wednesday in response to big wins by Democrats in the midterm elections.

Stock index futures swooned as the results started to emerge but later ​trimmed losses on Wednesday, with S&P 500 futures down 0.5% and Nasdaq futures off 0.8%.

The U.S. dollar index, which measures the greenback's strength against a basket of six currencies, was down 0.2% at a one-month low of 101.51.

Asian stocks were, meanwhile, mixed Wednesday as investors tried to ascertain the impact of a Democratic sweep of Congress that dealt a blow to President Donald Trump's economic agenda as he heads into his final two years as president.

Equities and the dollar sank initially amid warnings that the result – which saw Republicans ousted in a so-called blue wave – could lead to gridlock on Capitol Hill after Trump warned that he would become "Mr Veto."

Tech firms, already under pressure, were also hit by concerns about the future of data center building – a major bone of contention in many places.

Tens of millions of Americans cast their vote in the crucial polls pitched as a referendum on the White House amid anger at surging petrol prices, tariffs and the Iran war.

'Potential legislative gridlock'

With Democrats winning key races to flip the House and Senate – including once-safe Republican seats – Chris Weston at Pepperstone flagged "the potential for legislative gridlock, fiscal brinkmanship, debt-ceiling disputes, and congressional investigations."

However, he added that "the president would retain considerable executive authority, so the implications for individual sectors are far from straightforward."

Trump threatened in a telephone interview with the CBS network on Tuesday to be "Mr Veto" and block any Democratic legislation if they win.

The prospect of Congress coming to a standstill weighed on the dollar and Treasury yields, with observers pointing out that such a scenario would restrict spending.

"Democratic control of Congress will make it harder for the White House administration to pass major partisan legislation. That could reduce the prospect of significant additional fiscal stimulus over the next two years," wrote David Chao at Invesco.

"For Asia, the implications matter. Less fiscal stimulus could reduce upward pressure on US growth, inflation and Treasury yields, potentially easing some of the pressure that higher US rates and a stronger dollar have placed on Asian currencies and monetary policy."

However, as the results came in, he offered a more conciliatory tone to the New York Times, saying he was "absolutely willing to accept those results" and expected to work out deals with Democrats.

That provided the queue for a bounce in some stock markets, as well as the dollar and Treasury yields.

Hong Kong, Shanghai and Seoul reversed losses, while Wellington and Manila were also up.

However, Tokyo, Sydney, Singapore, Taipei, Mumbai, Bangkok and Jakarta all fell.

While they managed to pare losses, tech firms remained under pressure as investors continue to fret over the AI investment boom and when firms that have pumped billions into the sector will eventually see returns, if ever.

AI outlook uncertain

Traders were also nervous about the outlook for the AI buildout, with many Democrats taking advantage of anger over data centre development.

"The concern isn't that a Democratic governor automatically shuts the gates on data-center construction," said Stephen Innes at SPI Asset Management.

"It is that a change in political leadership could alter the regulatory environment just as developers are committing enormous amounts of capital to projects dependent on electricity availability and predictable construction schedules."

Japanese chipmaker Kioxia plunged more than 5%, while Advantest and SoftBank lost more than 3%. Seoul's SK hynix and Samsung were also down.

Oil prices edged up as investors kept tabs on the Middle East after Trump confirmed U.S. strikes on Iran but played down speculation he was preparing to resume bombing after the election.

"We seem to be getting everything we want," he told the Financial Times newspaper on Tuesday.

"I'm ready, we're ready. We're locked and loaded if we need to go, but there may be no reason for it."

His Iranian counterpart Masoud Pezeshkian said his government was still trying to resolve the crisis "through dialogue," adding that "no one will benefit from this war" if it reignited.

However, Iran's chief negotiator, Mohammad Bagher Ghalibaf, said the Islamic republic was "ready for battle with its finger on the trigger," while Deputy Foreign Minister Kazem Gharibabadi said Tehran retained the right to "legitimate self-defense."

He later posted on X that "Americans said NO TO WAR, and we endorse this message."