Stocks of targeted companies historically drop on news of a congressional probe With Democrats appearing on track to take control of at least one chamber of Congress in next month’s midterm elections, many companies soon could be dealing with extra attention — and not the kind that lifts stock prices. Law and lobbying firms in Washington, D.C., are telling companies to prepare for a new level of scrutiny, since most modern midterm elections result in some loss of congressional control for the party that holds the White House. Don’t Short Yourself offers weekly money tips to help you earn it, stack it and grow it.
I would like to receive updates and special offers from Dow Jones and affiliates. I can unsubscribe at any time. Below are some key types of companies that could end up facing high-profile hearings on Capitol Hill, congressional investigations or other types of inquiries.
Concerns about artificial intelligence and affordability are likely to drive some Democratic lawmakers’ investigations, according to Evercore ISI analysts led by Sarah Bianchi. AI labs such Anthropic, OpenAI and Google Gemini could have trouble if such probes reveal “additional information about hacking, models breaking containment, or internal emails acknowledging AI safety challenges,” the analysts said in a recent note. Meanwhile, Democrats could put a spotlight on oil executives if the Iran war drags on and gasoline and diesel prices remain elevated, and that may reignite conversations around a windfall-profits tax or measures to lower prices, the Evercore team said.
That’s because 17 big pharmaceutical companies made drug-pricing deals with the Trump administration, and Democratic lawmakers have argued that more details about those deals need to be released. A Democratic-run House or Senate also is likely to take aim at companies that have contracts with the Department of Homeland Security or that facilitate the detention or deportation of immigrants, as the opposition party makes an effort to challenge President Donald Trump’s immigration policies, Lokay said. Private-prison operators GEO Group and CoreCivic — which both saw their stocks surge when Trump won the 2024 White House race — are examples of such companies.
Companies that have granted equity stakes to the Trump administration — such as Intel , MP Materials and USA Rare Earth — along with companies that are connected to Trump family businesses, are likely targets for investigation, the Evercore analysts said. The analysts said companies that have donated to Trump’s controversial White House ballroom project could see probes as well. Amazon , Apple and Meta are among the corporate donors to that project.
The Democratic lawmaker who is expected to chair the House Oversight Committee if his party wins control of the House — Rep. Robert Garcia of California — already has been criticizing ballroom donors. A year ago, Garcia co-sponsored a bill that was called the Stop Ballroom Bribery Act.
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