- Lead. The Dow lost 1,833 points, the Nasdaq Composite entered a formal correction, and AMD fell 17.3% on Thursday as investors repriced the regulatory outlook for AI under a Democratic Congress.
- Fact. The Nasdaq dropped 5.5% to 24,315—more than 10% below its October record—while the S&P 500 fell 4.4% to 7,354, CBS News reported, marking the worst second day after a midterm in nearly a century.
- Stake. The selloff signals that markets had been pricing in an uninterrupted regulatory environment for AI and data centres; a Democratic majority changes both assumptions.
The Selloff and Its Cause
Thursday’s rout followed a sharp reversal from Wednesday, when the Dow posted its biggest single-day gain of the year as markets initially cheered the electoral clarity of a Democratic sweep. By Thursday, analysts had worked through the implications for the technology sector and concluded the picture was less benign. The core concern is permitting and infrastructure policy: AI data centres require rapid construction approvals, significant power grid investment, and coordination with state regulators. A Democratic-controlled Congress that prioritises environmental review, labour standards, and anti-monopoly measures could slow the pipeline of large data centre projects that underpin AI capital spending, analysts cited by CBS News said.
Chris Larkin of E*TRADE from Morgan Stanley described “visible cracks in the AI ecosystem.” Joe Maher of Capital Economics questioned whether the midterms might be the event that “derails” the AI equity boom, noting that the sector had been priced on assumptions about an uninterrupted regulatory and permitting environment that now looks less secure.
Stocks Hit Hardest
AMD bore the worst damage, falling 17.3% on the session as investors reassessed demand assumptions for AI accelerators if large-scale data centre construction slows. Nvidia dropped 9.2%, extending a 3.2% decline from the prior session. CoreWeave, the Nvidia-backed AI cloud provider, fell 9.8%. Trump Media & Technology Group dropped 10.5%, trading near $4—an all-time low—after losing nearly 25% on Wednesday.
The AI rout that began earlier this week had already erased $2.2 trillion in market capitalisation from AI-exposed equities before Thursday’s midterm-driven leg down. The Nasdaq 100 alone shed approximately $2.3 trillion in value on Thursday, according to NBC News, leaving the index at its weakest level since late July.
IPO Pipeline and Friday Outlook
Adam Crisafulli of Vital Knowledge said the selloff could delay Anthropic’s planned Nasdaq listing, which had been expected this month at a valuation of roughly $1.5 trillion and could raise up to $100 billion. Anthropic had updated its S-1 with $17 billion in Q3 revenue and had set its roadshow for November 10, but the sharp fall in comparables makes pricing more difficult.
Brent crude recovered 2.6% to $97.11 on Thursday, partially reversing a 9% drop the prior day tied to Trump’s public reassurances on Iran. That rebound cushioned energy names but did little for technology. As of Friday morning, US futures were mixed—Dow futures pointed lower while S&P 500 futures edged marginally higher—suggesting markets had not yet found a clear footing after two of the year’s worst back-to-back sessions.