New Delhi, Nov. 9 -- The Democrats' sweeping victory in the US midterm elections could ease inflation concerns and push long-term bond yields lower, according to Morgan Stanley.

Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley, noted that while the Democratic victory was initially perceived as a negative outcome for financial markets, several factors could help fixed-income investors become more comfortable with the results.

"The word surprise has lost some meaning in investing over the years, but the US election results qualify," Sheets said, highlighting that Democrats secured significantly more seats in both chambers of Congress than anticipated.

He noted that investors had reduced their market exposure ahead of...