GLOBAL MARKETS — Trillions of dollars were erased from major technology stocks across the US, Europe, and Asia following the US midterm elections, as political shifts fueled anxieties over a potential slowdown in artificial intelligence development.
In the United States, the tech-heavy Nasdaq share index dropped 5.5% on Thursday, shedding an estimated $2.5tn in market value. The sell-off also dragged down the "Magnificent Seven" tech giants—including Apple, Nvidia, and Tesla—which collectively lost $1tn in value during a single trading session. Chipmakers took especially hard hits, with Nvidia shares falling more than 9%, while Advanced Micro Devices (AMD) and Micron both plummeted by over 17%. European markets followed suit with declines in chipmakers and equipment manufacturers like Infineon and ASML, before the wave of selling swept into Asian markets on Friday, pulling down indices in Japan and South Korea.
Market analysts attribute the sharp correction to a combination of existing worries over whether massive capital expenditures in AI infrastructure will yield expected returns, alongside new political headwinds. During Tuesday's midterm elections, Democrats captured both the Senate and the House of Representatives, gaining control of Congress for the remainder of President Donald Trump's term. Throughout the campaign cycle, Democratic candidates opposed the construction of large data centers required to power AI, and multiple ballot measures sought to restrict the facilities.
Financial experts noted that the election outcomes heightened investor fears of stricter federal regulation and potential moratoriums on new data center construction. While industry leaders admitted surprise at the scale of the community and political backlash, some political figures and investors argued that the market correction reflects overdue oversight on an industry that has grown rapidly without robust safeguards.
