2028 vision:
Last week, 2028 Democratic hopefuls descended on NYC for the National Action Network Dinner hosted by Rev. Al Sharpton. Attendees included Kamala Harris, Pete Buttigieg, and Pennsylvania Gov. Josh Shapiro, among others. Notably missing from the list, though, was California Governor Gavin Newsom, who continues to lead the 2028 Democratic field with a 26% chance of clinching the nomination.
On the GOP side, Vice President JD Vance leads with a 36% chance of winning the nomination, although that has slipped from 50% since the start of the year. Secretary of State Marco Rubio remains Vance’s strongest potential challenger, at a 26% chance to be the nominee. Notably over the weekend, Rubio attended a UFC fight with Trump while Vance led the (ultimately unsuccessful) U.S. – Iran negotiations in Pakistan.
Overall, markets have grown more bullish on Democratic chances since the conflict in Iran began. On Sunday, traders gave Democrats a 59% chance of winning the 2028 Presidential election and a 41% chance of winning a trifecta, both new all-time highs.
2026 midterms big picture:
Democrats maintain a strong 85% chance to win back the House. Traders see Democrats as favored in 235 House seats – the same number they won in the 2018 blue wave – while Republicans are favored in 197. Three House seats are seen as tossups.
Meanwhile, Senate control is a total tossup, with Democrats and Republicans dead even at 50% chance each of controlling the upper chamber. Democrats are up from 33% at the start of the year and are currently favored in 51 Senate seats, including GOP-held North Carolina, Maine, Ohio, and Alaska.
Weekly politics roundup:
No U.S. – Iran deal yet. Vice President JD Vance’s high-stakes negotiations with Iran in Pakistan did not yield a deal to permanently end the war. After the initial two-week ceasefire was announced, the chance that a U.S. – Iran nuclear deal would be reached by the end of 2026 jumped to 58%, although that has now dropped to 49% as of Sunday night. And in a sign of how tenuous the current truce remains, the chance that Strait of Hormuz traffic returns to normal by May 1 briefly spiked over 50% before collapsing to 11% as President Trump made a new vow to use the U.S. Navy to blockade the Strait.
California’s gubernatorial election in turmoil. Frontrunner Rep. Eric Swalwell announced he was dropping out of the closely-watched California governor race on Sunday after facing widespread outcry over sexual harassment allegations from a former staffer late last week. Traders now favor Democratic billionaire Tom Steyer to succeed Gavin Newsom as the leader of the Golden State, followed by former U.S. Rep. Katie Porter and San Jose Mayor Matt Mahan. Trump, meanwhile, endorsed Republican Steven Hilton, which may ironically help Democrats avoid being locked out of the general election by consolidating the GOP vote.
Expulsion discussions heat up on the Hill. In addition to Swalwell, Democrats and Republicans are considering expulsion votes for several other members of the House who are facing serious ethics scandals. Those potentially facing expulsion include GOP Rep. Tony Gonzales, who dropped his reelection bid after admitting to having an affair with a staffer (who later committed suicide), Dem Rep. Sheila Cherfilus-McCormick, who allegedly misused $5 million in federal disaster relief funds, and GOP Rep. Cory Mills, who is under investigation for both alleged campaign finance violations and sexual misconduct. But given that the House is usually reluctant to expel its own, and with Gonzales and Mills holding potentially vulnerable districts, traders are not confident that anyone will ultimately get the boot – there’s still only a 55% chance that any member of Congress is expelled this year.
The Cook Political Report moved Iowa’s governor’s race to a tossup. Our markets have had this race as a tossup since January, with state auditor Rob Sand being the strongest candidate for Democrats in the red-leaning state. Outgoing GOP governor Kim Reynolds’ low approval rating, according to tracking firms like Morning Consult, could also potentially weigh down Republicans.
Virginia: The next big election. The Old Dominion is set to vote April 21 on a constitutional amendment that would allow the state legislature to redraw the commonwealth’s congressional maps mid-decade. The referendum, backed by Democrats, could help the party flip as many as 4 House seats and give them control of 10 out of 11 districts. Despite initial signs of high Republican enthusiasm and tight polls, though, traders believe that the referendum has a 90% chance of passing, albeit by a smaller margin than the Democrats’ 15-point blowout in the governor election last fall.
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