US stocks lose $3.2 trillion after midterm results

Wall Street stocks lost $3.2 trillion in value on Thursday following a volatile trading session. The tech-heavy Nasdaq 100 index plunged 6.4 percent, marking one of the largest single-day declines since the turn of the millennium. Investors rushed to sell shares linked to artificial intelligence after Democrats secured a sweeping victory in Tuesday's midterm elections.

Nvidia, the chipmaker most closely associated with the AI surge, fell 9.3 percent. The drop pushed the company's market value down by more than $400 billion. Other chipmakers suffered steep losses, with Qualcomm dropping 9.5 percent, Broadcom falling 10 percent, and Micron shedding 17 percent.

The S&P 500 index lost 4.4 percent, its worst session since April 2025. The decline indicated that selling pressure spread beyond AI-specific stocks into the broader market. Adam Crisafulli, president of market research group Vital Knowledge, described the reaction as investors "throwing in the towel and indiscriminately liquidating."

Market analysts linked the rout to fears that the new Democratic majority will slow AI spending. Charles-Henry Monchau, chief investment officer at Swiss private bank SYZ Group, said investors fear that peak AI capital spending is behind them. Newly elected politicians who campaigned against data centers are expected to influence infrastructure development. This shift threatens the vast spending on chips and servers that drove stocks to record highs earlier this year.

Specific proposals from incoming lawmakers fueled the concern. Michigan senator-elect Abdul El-Sayed called for a "full-on pause" in frontier development, arguing that the pace of technology is outpacing safety. Incoming South Carolina senator Annie Andrews proposed a two-year ban on new data center construction to protect communities from powerful companies.

Companies led by Elon Musk also saw sharp declines. Tesla fell 10.8 percent on Thursday, adding to a 3.3 percent drop on Wednesday. SpaceX was down 9.1 percent, following a 3.8 percent decrease the previous day. Both companies are based in Texas, where Democrats won the governor's race and a Senate seat for the first time in over 30 years.

Vincent Mortier, investment chief of Amundi, noted that the initial gains for US stocks after the election were "very shortlived." He described the tech repricing as harsh and quick, citing a new political focus on data center backlash and regulation. A New York brokerage chief executive observed that bargain hunters were not jumping in, with many investors hiding out in cash.