US stocks tumble as tech firms lose hundreds of billions after midterm elections
US tech stocks plunged after the midterm elections, in which Democrats won control of Congress. The Nasdaq closed down more than 5.5% amid fears of a slowdown in AI development.
Share prices of major US technology and artificial intelligence (AI) companies fell sharply on Thursday, wiping hundreds of billions of dollars from their market value. The sell-off followed the US midterm elections, in which Democrats won both the Senate and the House of Representatives, taking control of Congress for the rest of President Donald Trump's term. Investors fear that the buildout of AI infrastructure could slow down.
Index falls
The tech-heavy Nasdaq Composite closed down more than 5.5%, losing an estimated $2.5tn in market capitalisation, according to Dow Jones data. The S&P 500 fell 4.4%, while the Dow Jones Industrial Average finished down more than 3.4%. These were the worst days for the indexes since 2025. The Nasdaq's drop was large enough to put it in correction territory, meaning more than 10% below its recent high.
Company losses
Nvidia shares slid more than 9%, erasing over $400bn of value. AMD and Micron each dropped more than 17%, Intel fell 10.3%, and memory maker SanDisk lost more than 22%. The Philadelphia Semiconductor Index, which tracks 30 of the largest chip-industry companies, declined by more than 12%. Shares in Elon Musk's SpaceX and Tesla fell 8% and nearly 11% respectively, together shedding more than $300bn. The so-called magnificent seven tech companies lost a trillion dollars in value in a single trading day.
Political background
Many Democrats campaigned on slowing the spread of data centres and AI, and dozens of ballot measures across the country aimed to restrict data centre development. Texas governor-elect Gina Hinojosa, a Democrat, pledged a moratorium on new construction of such facilities. Musk had spent nearly $450m backing Republican campaigns, but Texas turned blue.
Trump blamed the market slide on his political opponents. OpenAI president Greg Brockman said the industry had been surprised by the backlash to data centres and that it must work with local communities. Meta president Dina Powell McCormick urged the industry to make a stronger case for AI.
