Dow rallies 500 points as investors anticipate midterm election results

Stocks rose Tuesday as investors awaited the results of the US midterm elections, which could impact future levels of government spending and regulation.

The Dow Jones Industrial Average gained 522 points, or 1.6%, on track for its third straight up day. The S&P 500 rose 1.2%. The Nasdaq Composite was 1.5% higher.

The moves come after a day when all major indexes notched a second straight positive session. The Dow Jones Industrial Average closed higher by 423.78 points, or 1.31%. Meanwhile, the S&P 500 gained 0.96%, and the Nasdaq Composite rose 0.85%.

Markets expect Republicans to take back the House of Representatives and possibly win the Senate as well when results start rolling in Tuesday night. Investors tend to like the notion of gridlock in Washington with a divided Congress and President because it will limit government spending, new taxes and regulations.