Asian stocks advanced, tracking gains in US equities after a Democratic sweep in the US midterm elections sent oil plunging on speculation the conflict with Iran will end sooner.

Benchmark indexes rose in Japan and Australia, pushing the MSCI Asia Pacific Index up by 0.3%. That was after the S&P 500 Index jumped 1.6%, its biggest gain in three months, and the tech-heavy Nasdaq 100 climbed 0.9%. South Korea was the outlier, with the Kospi Index dropping 2.7%, reflecting investor concerns over the future of data-center development and losses in US chip stocks.

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Treasuries extended their gains from Wednesday on optimism lower oil prices will curb inflation. Bloomberg’s gauge of the dollar dropped for a second day.

US oil held its declines early Thursday after Brent crude slumped more than 8% to below $95 a barrel on Wednesday, following a pledge from Senate Minority Leader Chuck Schumer to end the Middle East war. Treasuries gained across the curve in US trading, as investors trimmed bets on Federal Reserve interest-rate hikes over the coming year. The dollar weakened the most in two months.

The equity market rally since the US election signals that investors are willing to look past a potential policy gridlock in Washington after Democrats wrested control of both chambers of the US Congress. The gain in Treasuries on oil’s slump and speculation that the so-called blue wave would limit President Donald Trump’s ability to add to the deficit is also seen as supporting stocks.

“The stock market is now celebrating congressional gridlock, President Trump’s willingness to work with the new Congress, and the fact that the Trump administration may not immediately attack Iran now that new negotiations are anticipated,” said Louis Navellier, chief investment officer at Navellier & Associates.

US stocks are set for gains into year-end as the election removes a source of uncertainty, earnings remain strong and lackluster investor positioning leaves room for renewed buying, according to Scott Rubner, head of equity and equity derivatives strategy at Citadel Securities.

Since 1946, stocks have been higher one year after every midterm vote, including all four instances when both the House and Senate flipped to the party opposing the president, said Keith Lerner at Truist Advisory Services Inc.

“That supports our base case of giving the bull market the benefit of the doubt, but earnings, the economy, interest rates, valuations, and market trends remain more important to our view,” he added.

While Democrats could complicate data-center development in some states, many investors see little immediate threat to the AI investment theme that’s powered a rally in stocks tied to the sector.

Greater congressional oversight will not necessarily derail the AI investment cycle as underlying demand is still solid, according to Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.

“Yes, potential worries over AI regulation are high, but the reality is markets hate uncertainty and now with the election out of the way, we are seeing buyers step in across the board,” said Ryan Detrick at Carson Group.