Global stock markets tumbled after investors sold technology shares on fears that U.S. midterm election results will slow the buildout of artificial intelligence. The sell-off began in the United States on Thursday and quickly spread into Asia and Europe, wiping trillions of dollars from major tech firms.
In the U.S., the tech-heavy Nasdaq Composite sank about 5.5%, falling into correction territory — more than 10% below its recent high. The index lost an estimated $2.5 trillion in market value. The S&P 500 dropped roughly 4.4%, and the Dow Jones Industrial Average plunged more than 1,800 points, or about 3.4%.
The so-called Magnificent Seven group, including Apple, Nvidia, and Tesla, shed about a trillion dollars in value in a single session. Nvidia shares slid more than 9%. Shares linked to Elon Musk’s companies also sank hard, with Tesla falling nearly 11% and SpaceX dropping about 8%, erasing more than $300 billion in combined market value.
Investors said the catalyst was political. Democrats won both chambers of Congress after candidates across the country campaigned against rapid AI data-center expansion. Dozens of local ballot measures also sought limits on the energy- and water-intensive facilities that power large AI models.
“Americans don’t want Big Tech oligarchs wrecking the environment, gutting jobs and threatening humanity’s future. NATIONAL DATA CENTER MORATORIUM NOW,” Sen. Bernie Sanders posted on X as markets fell.
President Trump blamed Democrats for the slide. “The Stock Market suffered one of the Worst Days in History based on the results of the Election,” he wrote, later adding that voters “only have yourselves to blame.” On Friday he restated support for the AI sector, saying only “foolish leadership” would reject the economic gains it can bring.
The U.S. sell-off spilled into Asia on Friday. Japan’s Nikkei closed down about 6% as memory-chip and equipment names sold off. South Korea’s Kospi plunged more than 8% at one point, briefly triggering a circuit breaker before finishing down about 6%. Chipmaker SK Hynix fell more than 10%.
European indexes also declined, though losses were milder because those benchmarks hold fewer AI-heavy stocks. The U.K.’s FTSE 100 fell nearly 2%, while Germany’s DAX dropped about 2.4%.
Analysts said the midterms compounded an already fragile AI trade. Investors have spent months questioning whether enormous data-center spending will produce returns soon enough. “The AI story has all been about speed, and now there is a danger of it moving to a lower gear,” said Dan Coatsworth, head of markets at AJ Bell.
OpenAI president Greg Brockman said tech leaders were surprised by the community backlash against data centers and argued companies must engage local residents rather than assume projects will be welcomed. Wall Street analysts also warned the turbulence could delay high-profile AI IPOs that had been expected later this month.
By Friday, U.S. futures pointed to a partial rebound as chip stocks attempted to stabilize, but weekly losses still looked likely after one of the harshest AI-driven sell-offs since the tariff shock of April 2025.
