RED WAVE, BLUE WAVE: What could happen to markets if Republicans win big or lose big on Tuesday

The midterm elections Tuesday have huge stakes not only for the future of health care, taxes and immigration, but also for the U.S. economy and investors.

Polls and forecasters suggest Democrats have a good chance of taking control of the House, while Republicans are favored to keep a slim majority in the Senate. But deviations from the expected outcome could have massive implications for investors.

Experts consider the GOP holding control of both chambers the second most likely outcome, followed by a Democratic sweep of Congress. It would be virtually impossible for Democrats to win the Senate without also gaining control of the House.

Each of those results would lead Congress to pursue different policy initiatives — and potentially block any progress toward those goals. Here we break down the likelihood of each scenario playing out, as well as what they mean for the overall market and individual stocks.

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