Global tech stocks plunge as US midterm results spark AI fears
Major technology and artificial intelligence firms in the US and Asia saw massive losses in market value following Democratic victories in US midterm elections.
Major technology and artificial intelligence firms in the US and Asia saw hundreds of billions of dollars in market value wiped out following the US midterm elections, according to BBC News. The sell-off was triggered by concerns regarding a potential slowdown in artificial intelligence development after Democrats won control of the US Senate and House of Representatives.
In the US, the tech-heavy Nasdaq composite index closed down by more than 5.5 per cent, losing an estimated $2.5tn in market value. Other indexes also saw significant losses, with the S&P 500 falling by 4.4 per cent and the Dow Jones Industrial Average closing down more than 3.4 per cent. Nvidia shares slid more than 9 per cent, while AMD and Micron both dropped by more than 17 per cent.
In Asia, tech-heavy indexes fell sharply on Friday morning. Japan's Nikkei 225 was 6 per cent lower in early trading, while South Korea's Kospi index plunged more than 8.5 per cent, triggering a circuit breaker. Taiwan's Taiex dropped by more than 8.3 per cent, with chipmaking firm TSMC falling by nearly 8.5 per cent.
The market decline follows Democratic campaigns focused on slowing the growth of data centres and AI. Texas Democratic governor-elect Gina Hinojosa has pledged a moratorium on new construction in the sector. MarketWatch chips analyst Britney Nguyen stated the sell-off marks a "continuation of worries" over spending on AI infrastructure.
Reacting to the market slide, Donald Trump blamed his political opponents in a social media post, stating the market suffered due to the election results. Democrat Senator Bernie Sanders also posted on X that Americans do not want Big Tech oligarchs threatening the future, calling for a national data center moratorium.