U.S. President Donald Trump delivers remarks during a campaign rally at Crossroads Arena in Corinth, Mississippi, on Oct. 26.AFP/YONHAP
Korean battery and power equipment stocks are getting a rare lift after a long slump, as investors bet on a “blue wave” in next week’s U.S. midterm elections, a Democratic sweep of both chambers of Congress that could revive the clean-energy incentives the Donald Trump administration rolled back.
Shares of Samsung SDI, one of the three largest battery makers in Korea, jumped 5.07 percent to close at 508,000 won ($384) on Tuesday, far outpacing the Kospi’s 3.09 percent gain. LG Energy Solution rose 2 percent to 382,500 won and SK Innovation inched up 1.09 percent to 138,500 won.
Power equipment maker LS Electric rose 3.4 percent, and HD Hyundai Electric edged up 0.67 percent.
The rally builds on a surge on Oct. 19, when Samsung SDI jumped 11.7 percent and LG Energy Solution and SK Innovation each gained more than 7 percentas midterm hopes combined with reports that Chinese energy storage makers, squeezed by Trump-era tariffs, had effectively pulled out of the U.S. market.
Expectations have shifted sharply since September. On Polymarket, the odds of a Democratic sweep stood at about 62 percent this week, up from 50.5 percent on Sept. 1. As of Oct. 26, traders put the chance of a Democratic Senate at 65 percent, up from just 41.5 percent at the end of June, while a Democratic House, at 92 percent, seems all but certain.
On Kalshi, another prediction market, traders put the odds of a Democratic sweep at 64 percent, a split Congress at 29 percent and full Republican control at 10 percent as of Oct. 26.
A Democratic Congress would likely push to restore the repealed $7,500 EV tax credit along with credits for wind and solar power. With AI data centers driving up electricity bills, power costs have become a campaign issue, and Democrats are pitching renewables as the answer.
Morgan Stanley favors renewable energy, consumer staples and pharmaceuticals, while JPMorgan expects health insurers and clean-energy companies to benefit in a blue-wave scenario.
“In their May energy agenda, Democratic leaders pledged to restore the Inflation Reduction Act, clean-energy tax credits that Trump scaled back, simplify permitting for clean-energy projects and expand investment in transmission and energy storage,” said Kim Jae-seung, an analyst at Hyundai Motor Securities, who expects clean energy and energy storage to rebound most sharply.
“With U.S. trade barriers on Chinese goods still in place, Korean solar, green-energy and energy storage companies with U.S. production bases stand to gain the most from a Democratic sweep.”
The data center boom is already fueling North America’s energy storage market. LG Energy Solution plans to expand its North American storage capacity to 50 gigawatt-hours by the end of the year, while Samsung SDI has converted part of its U.S. production to lithium iron phosphate batteries for storage.
The American Airlines Center in Dallas, Texas, which hosted the Republican Party’s midterm convention.YONNHAP
The U.S. Energy Information Administration expects electricity consumption to hit records for two straight years, climbing from 4.2 trillion kilowatt-hours last year to 4.3 trillion this year and 4.4 trillion next year.
Hana Securities projects battery makers’ net profit will jump 129.1 percent next year, outpacing the chip sector’s 35.6 percent.
Power equipment makers also stand to benefit as senators from both parties agreed on a bill to speed federal permitting for transmission lines, renewable projects and data centers on Sept. 30.
A Democratic Congress is expected to press for tougher rules requiring tech firms to share the cost of the power their data centers consume, which is pushing up household bills. That would be a burden for U.S. tech companies but an opportunity for Korean suppliers.
To sidestep regulation and grid-connection delays, tech companies are likely to accelerate the construction of their own substations and independent grids, lifting demand for extra-high-voltage transformers. HD Hyundai Electric, Hyosung Heavy Industries and LS Electric are Korea’s biggest suppliers of such equipment to the United States.
“With electricity prices at the center of the midterms, bipartisan permitting reform will ease the bottleneck in transmission construction,” said Julie Cho, a U.S. strategy researcher at NH Investment & Securities.
“Power equipment such as extra-high-voltage transformers is the most direct beneficiary of grid expansion, which is an opportunity for Korean manufacturers, the largest source of U.S. large-transformer imports.”
