Here’s how much stocks could fall if the Democrats sweep Congress, according to BofA

Bank of America's Michael Hartnett is warning that equities face 10% downside or more if prediction markets are right about the midterms and Democrats take both houses of Congress.

Hartnett, BofA's chief investment strategist, says the rising probability of a Democratic sweep poses a meaningful threat to risk appetite. His 10%-plus downside estimate ties the move directly to what prediction markets are currently pricing, making the election odds themselves the variable to track.

Two specifics anchor the call: the magnitude (10% or more) and the trigger (Democratic control of both the House and Senate). The framing is conditional. Hartnett's downside scenario rests on prediction-market odds proving correct, so a shift in those odds would change the risk calculus.

Interpretation, not sourced fact: a call from a strategist of Hartnett's profile can influence positioning around political risk, particularly if prediction-market probabilities keep climbing. A 10% drawdown would be a sizable repricing for an equity market that, by Hartnett's reading, is not fully discounting this outcome.