As Democrats are projected to take control of the U.S. House of Representatives, some investors may find investing in the United States a less appealing proposition, according to one strategist.
Mark Jolley, global strategist at CCB International Securities, told CNBC as polls were closing that a Democratic capture of the House could disrupt global investment patterns because some investors fear the consequences of a more divided U.S. political environment.
People are afraid, he said, that a Democrat-controlled House would mean more gridlock in Washington, and could therefore lead global investors to rethink their prioritization of the U.S. as their main investment option.
Many political analysts have projected that such gridlock could arise from the Democrats blocking Republican attempts to cut taxes and roll back Obama-era health care programs. Still, the shift in power could also open the door to cooperation on reducing drug prices or improving infrastructure.
The strategist described the current investment environment as one in which "people are over-invested in the U.S. economy," "overweight" on U.S. Treasurys and the dollar is "over-owned." Therefore, investors should look out for market responses in the stock, bond and currency markets, Jolley added.
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