Democrats and Republicans battled on almost even terms in early returns last night from the midterm election of 1978.

According to unofficial TV network projections, Democrats were likely to take over Republican Senate seats in New Jersey and Michigan, but to lose seats in New Hampshire and Misissippi.

Republicans were leading for previously Democratic gubernatorial seats in Tennessee and Pennsylvania, but were trailing badly in their effort to retain the governorship in South Carolina.

Sen. Charles Percy (R-Ill.) appeared to be turning back a tough challenge from Democrat Alex Seith, while Illinois voters were handling a second term to Gov. James R. Thompson (R).

The House also looked stable, with the only turnover indicated in early returns and expected GOP takeover of an open Democratic seat in Kentucky.

The indicated Democratic Senate winner included basketball star Bill Bradley, who was leading in New Jersey over conservative anti-tax spokesman Jeffrey Bell (R), who ousted Sen. Clifford P. Case (R.N.J.) in the primary.

In Mississippi, which has not elected a Republican to the Senate in its history, Rep. Thad Cochran (R) was winning a three-way race to succeed retiring Sen. James O. Eastland (D-Miss.).

In New Hampshire, airline pilot Gordon Humphrey (R), a conservative caucus leader, appeared to be threatening Sen. Thomas J. McIntyre (D-N.H.).But in Michigan, Sen. Robert P. Griffin (R), a two-term veteran, was trailing Carl Levin (D), the former president of the Detroit City Council.

In the three potential gubernatorial switches, Richard W. Riley (D) was winning the South Carolina governorship, being vacated by retiring Gov. James B. Edwards (R).

In Pennsylvania, former Pittsburgh prosecutor Richard L. Thornburgh (R) was leading former Pittsburgh Mayor Pete Flaherty (D) to succeed retiring Gov. Milton J. Shapp (D).

In Tennessee, lawyer Lamar Alexander (R) was leading banker Jake Butcher (D) in the battle to succeed retiring Gov. Ray Blanton (D).

Nancy Landon Kessebaum (R), daughter of 1936 GOP presidential candidate Alf Landon, was leading Bill Roy (D) in Kansas, but another woman candidate, Jane Eskind (D), was apparently defeated by Senate Minority Leader Howard H. Baker Jr. (R-Tenn.).

The Senate's lone black member, Sen. Edward W. Brooke (R-Mass.), was trailing in his try for a third term, with networks projecting Rep. Paul E. Tsongas (D-Mass.) as the likely winner.

Sen. Strom Thurmond (R-S.C.), the 75-year-old conservative stalwart, defeated his 40-year-old businessman challenger, Charles D. (Pug) Ravenel (D).

And next door, in North Carolina, another prominent conservative, Sen. Jesse A. Helm (R) was on his way to reelection.

The campaign was dominated by economic issues, and, on the day of the voting, the stock market - nervous about last week's money-tightening moves by the Carter administration and the Federal Reserve Board - Iell almost 15 points.

With inflation at close to double-diget levels, an Associated Press-NBC poll of voters leaving the polls found [WORD ILLEGIBLE] times as many believed that the economy will improve in the coming year.

Early in the evening, Democrats tucked away expected Senate victories in four Southern and border states. Sen. J. Bennett Johnson (D-La.), Sam Nunn (D-Ga.) and Walter (Dee) Huddleston (D-Ky.) won their second terms. And Howell Heflin (D), the former chief justice of the Alabama Supreme Court, was chosen to succeed retiring Sen. John J. Sparkman (D-Ala.).

Johnson and Heflin had no Republican opponents, and Nunn and Huddle ston had only omial opposition.

In several states, there was a changing of the guard even if there was no change in party control.

The George Wallace ear in Alabama politics, which began 16 years ago, came to an end with the election of Forrest (Fob) ames as the new governor. James, a businessman and one time Republican fund-raiser, presented himself as "a beginning" for Alabama.

Advance predictions had been that the turnout yesterday would be the lowest in a midterm election since the wartime year of 1942. But scattered reports during the day reported exceptions to that pattern in a dozen states.

The most serious voting problems were reported in Philadelphia, where large numbers were drawn to the polls by a referendum on a proposed city charter change that would allow Mayor Frank Rizzo (D) to seek a third term.

There were complaints that voting levers on some machiners had been locked to permit only a "yes" or pro-Rizzo vote.

In other closely watched contests, early evening network projections showed:

Sen. Charles H. Percy (R-Ill.) defeating challenger Alex Seith (D), whose controversial anti-Percy ads apparently boomeranged in the closing stage of their race.

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Sen. Robert P. Griffin (R-Mich) losing his third-term bid to Carl Levin (D), former president of the Detroit City Council.

Gov. James R. Thompson (R) of Illinois winning reelection over state Comptroller Michael Bakalis (D).

State Sen. Donald Stewart (D) leading ex-representative Jim Martin (R) for the Alabama Senate seat of the late Sen. James B. Allen (D).

All told, voters filled 35 Senate seats, 36 governorships, all 435 House seats and a host of lesser offices. The spending on congressional races passed the $138 million mark on Sept. 30, and is expected to top $150 million by the time all the reports are in.

Legislatures were chosen in 45 states, and 16 states had referenda on various kinds of tax and spending policy.

With Republicans in a minority at every level of government, GOP leaders were looking to 1978 to begin a process of revival.

Republican National Chairman Bill Brock set his preelection goals as breading even in the Senate gaining 15 to 20 House seats four to six governorships and 200 legislative seats.

The lineup of strength before the election:

Senators: 62Democrats (including Virginia independent Harry F. Byrd Jr., who caucuses as a Democrat) and 38 Republicans.

Representatives: 288 Democrats and 147 Republicans, including three Democratic-held seats that were vacant at the end of Congress and one such vacant Republican seat.

Governors: 37 Democrats, 12 Republicans and one independent.

State legislators: 5,078 Democrats and 2,401 Republicans, as of the beginning of the 1978 session.

The historical yardstick for midterm elections is a flexible one. During this century, the president's party has lost an average of four Senate seats and 34 House seats in each midterm election.

But the average loss has been much smaller in the first midterm election following a change in party control in the White House - which was the situation this year.

In the four such elections since the New Deal that fit this definition - 1934, 1954, 1962 and 1970 - there was only a slight disturbance in the political status quo. The president's party lost only six House seats, on the average, and gained four Senate seats.

Despite this somewhat discouraging propect, the Republicans mounted by far the largest effort they had ever made to recruit candidates, train campaign workers and raise funds for a miderm campaign.

Their efforts far outdistanced those of national Democratic committees, which operated with skimpy treasuries, despite their control of the White House and Congress.

But both parties' spending was dwarfed by that of the business, professional and labor political-action committees (or PACs), which played a larger role in this midterm election than ever before.

Most of the PAC money went to incumbents, adding to the burdens challengers faced in overcoming the odds. But some challengers solved that problem neatly by reaching into their own wallets for campaign funds. In a few instances those personal contributions reached into the six and seven-figure category.

Because of the advantages possessed by incumbents, both parties focused resources on races where retirements, primary election defeats or campaigns for other office had left the seats vacant.

There were 13 open Senate seats, 58 open House seats and 15 open governorships - guaranteeing a significant turnover in officialdom even before the first vote was cast.

The lucky people in yesterday's election were those who had their races won in advance. Sen. J. Bennett Johnston (D.La.) won his second term in September, under Louisiana's unique "open primary" law, in which Republicans and Democrats run on the same ballot and anyone who wins a majority is elected. Seven of the eight Louisiana representatives took advantage of the same provision to put their elections behind them.

Around the country, 73 House members - 51 Democrats and 22 Republicans - had only minor-party opposition or no opposition on the ballot.

In advance of the voting, it appeared that neither party had been able to impose a national issue on the election. The Republicans tried to make the issue their Kemp-Roth taxcut proposal, which would reduce rates 33 percent across the board in the next three years.

But a Democratic-controlled Congress had just passed a major tax-reduction bill, and Democrats argued that the GOP proposal would simply add fuel to the fires of inflation.

President Carter, Vice President Mondale and members of the administration were out stumping for Democratic candidates, but most of those candidates stressed their independence of the administration, and asked the voters to judge them as individuals - not as Carter proxies.

It was the pattern of those individuals choice - rather than any one-dimensional national referendum - that awaited as the voters were counted.