Bank of America strategist Hartnett stated in a research report published on August 23 that the market is overly optimistic about the midterm elections. He believes that once the Democratic Party wins the Senate, two core narratives—financial deregulation and political support for AI capital expenditure—will simultaneously be impacted. He anticipates a stock market correction of over 10% before the end of the year, accompanied by a weaker dollar and lower bond yields. Hartnett also specifically mentioned the Texas gubernatorial election, considering its outcome a "referendum" on AI infrastructure power costs and affordability policies, which could affect the market's pricing logic for AI hyperscale investments. He suggested hedging risks through put options on financial stocks (XLF) and semiconductor ETFs (SMH), noting that approximately $6 billion has flowed out of semiconductor ETFs in the past three weeks.