ACP Lending

Democrats Took Congress Overnight. The 10-Year Fell to 4.90% Before the Treasury Says How Much It Will Sell.

By Steve Waller · November 4, 2026

Democrats Took Congress Overnight. The 10-Year Fell to 4.90% Before the Treasury Says How Much It Will Sell.

With Democratic control of both chambers projected, the 10-year Treasury fell about 5 basis points overnight to roughly 4.90%, from 4.91% on Monday and 5.05% on October 28. Mortgage News Daily's 30-year index has not followed yet, at 7.30% on Tuesday. On a $264,000 loan, every tenth of a point is worth about $2,600 of loan to an exit buyer, and the Treasury's auction plan lands at 7:30 a.m. Central.

Monday's question, answered halfway

Monday's brief asked what the overnight election results and the Treasury's auction plan would do to the 10-year, and whether it would still be below 5% going into Friday. The first half has an answer. Networks projected Democratic control of the House overnight, Democrats won Senate races in South Carolina, Texas and Ohio, and prediction markets put the odds of Democratic control of both chambers above 99%, with counting still under way in several states. The 10-year Treasury fell about 5 basis points to roughly 4.90% in overnight trading, per Reuters, after finishing Tuesday near 4.94%.

The second half lands at 8:30 a.m. Eastern, 7:30 Central, this morning, when the Treasury announces how many notes and bonds it will sell this quarter.

Why bonds rallied on the result

Bond markets read this election as a fiscal story, not a party story. A split between the White House and Congress makes a large new spending or tax package harder to pass, and less new borrowing means less new supply for a market that spent September worrying about exactly that. The flight to safety helped too: S&P 500 futures fell about 1.2% overnight and Nasdaq-100 futures about 2%, and money that leaves stocks in a hurry tends to land in Treasuries.

A divided government limits new deficits. It does not shrink the existing ones, and it adds shutdown and debt-ceiling risk next year. One night's rally is a reaction, not a trend.

The borrowing number, and what to watch at 7:30

On Monday the Treasury cut its October-to-December borrowing estimate by $10 billion to $618 billion, assuming an end-of-December cash balance of $850 billion. The cut came almost entirely from a higher starting cash balance, $984 billion against the $950 billion it had assumed in August. Strip that out and the underlying need is $24 billion higher than the August estimate. For January through March it expects to borrow $800 billion.

This morning's question is whether the Treasury keeps its line that it expects to hold coupon auction sizes steady "for at least the next several quarters." If it does, the overnight rally has room to hold. Any hint of larger long-term auctions works against it.

Where rates stand going in

The Federal Reserve's H.15 release has the 10-year at 4.91% on Monday, November 2, down from 5.05% on October 28, with the 2-year at 4.59% and the 30-year at 5.28%. Mortgage News Daily's 30-year index lagged the bond move, ticking up to 7.30% on Tuesday from 7.27% on Monday. Freddie Mac's weekly survey stands at 7.24% and updates Thursday.

Tuesday's September job openings report did not help the case for lower rates. Openings rose to 7.5 million from 7.2 million, quits rose to 3.4 million from 3.0 million, and layoffs fell to 1.6 million from 1.8 million. Workers who quit more freely expect to find better pay elsewhere, and that is the wage pressure the Fed is watching. Markets still price about a 75% chance of a hike on December 9.

What this does to a deal you are underwriting now

On a $264,000 loan, 20% down on a $330,000 house, principal and interest at Mortgage News Daily's 7.30% is about $1,810 a month. Hold that payment and every tenth of a point is worth about $2,600 of loan to your exit buyer: about $266,600 at 7.20%, about $261,400 at 7.40%. The overnight bond rally has not reached the mortgage index yet. If it holds through this morning and Friday, that is the order of magnitude to expect, not a windfall.

Houston

HAR's October report arrives in mid-November and will be the first local read on October's lower rates. Until then the backdrop is the one September set: more homes for sale than a year ago, slower contract activity and longer marketing times. That favors a buyer who arrives with a supportable price and financing already in place.

The week ahead

The question for Friday's brief is whether the payroll number and wage growth confirm a December hike, and whether the 10-year can hold below 5% through it.

The full report, and every earlier one, is available on ACP's website at acp-lending.com. Investors can sign up at acp-lending.com/investor-brief to receive new reports by email.

Sources

Market data is from public sources and is provided for information only. Nothing here is an offer of credit, a rate quote, or investment advice. Financing is subject to underwriting, lender approval, appraisal or valuation, title, insurance, property eligibility and program availability.

All briefs

Financing an investment property in this market? Start with a conditional pre-approval, or run the numbers yourself.

Start a Request Get Pre-Approved Deal Calculator

Every brief also posts on Facebook and LinkedIn — follow there for the short version.

Get new ACP reports by email

Every Investor Brief and market report goes out by email the morning it is published. The market data, and what it means for your financing. No rates, no pitch, and you can stop them in one click.

ACP Lending, 10 East Honey Grove Place, Spring, TX 77382. We do not sell or share this list. Privacy Policy.