(Bloomberg News) U.S. stocks fell, snapping a two-day rally, as investors' focus returned to the tax debate and Europe's debt crisis following the re-election of President Barack Obama.

"Here we go again in Washington," Ed Yardeni, president and chief investment strategist at Yardeni Research Inc. in New York, wrote. "President Barack Obama has won a second term. While he promised last night that 'the best is yet to come,' more political storms are likely."

While Obama received at least 303 electoral votes to Mitt Romney's 206, Republicans kept a majority in the House of Representatives. Democrats retained control of the Senate.

Now that the election has been decided, investors will turn their focus to the $607 billion of tax increases and federal spending cuts set to kick in automatically in January, the so-called fiscal cliff. The Congressional Budget Office has said the U.S. economy would slow by as much as 0.5 percent next year if Congress fails to keep the increases from taking effect.

Investors also watched the latest developments in Europe's attempt to tame its debt crisis. European Central Bank President Mario Draghi said inflation risks are "very low" and the debt crisis is starting to hurt Germany, Europe's largest economy.

Greek Vote

Greek lawmakers vote today on an austerity bill that contains austerity measures demanded by the so-called troika that oversees euro-area bailouts insists. A 31.5 billion-euro ($40 billion) aid payment has been frozen since June as Prime Minister Antonis Samaras's coalition government haggled over the measures and a two-year extension to meet the fiscal targets in the accord.

Efforts to meet the targets have been hampered by Greece's recession, now in its fifth year. The economy is forecast to shrink 6 percent this year and 4.2 percent in 2013, before growing 0.6 percent in 2014, according to the commission's report.

Biggest Plunge

While Obama's victory in 2008 spurred the biggest plunge ever for the Dow on the day after an election, gains for American assets over the past four years are among the best in the developed world. Fed Chairman Ben S. Bernanke's actions to revive the economy after the worst recession in seven decades helped send the Dow up 67 percent. The Dow has gained 3.9 percentage points more than the MSCI All-Country World Index since Obama's inauguration, beating 16 of 24 developed countries.

Stocks have on average rallied 3 percent in the two months following Election Day after a tight race, according to Thomas J. Lee, the chief U.S. equity strategist at JPMorgan Chase & Co., who cited historical data from the last five elections with close contests.

Yet since 1984, the S&P 500 has declined an average 0.9 percent on the day which followed presidential elections, according to data compiled by Bespoke Investment Group. The benchmark measure for American equities has risen only two of seven times on the day after the polls, the data showed.