Major tech stocks plunge as US midterms add to fears of AI slowdown — SkimNews
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- Nasdaq Composite closed down more than 5.5%, erasing an estimated $2.5tn in market capitalisation and entering correction territory; the S&P 500 fell 4.4%, the Dow Jones Industrial Average lost more than 3.4%, and the Magnificent Seven shed $1tn.
- Nvidia slid more than 9%, cutting its market value by over $400bn; AMD and Micron fell more than 17% each, Intel dropped 10.3%, SanDisk plunged over 22%, and the Philadelphia Semiconductor Index lost more than 12%.
- Tesla fell nearly 11% and SpaceX 8%, together shaving more than $300bn from their market value; Elon Musk had spent nearly $450m backing Republican campaigns, including at least $45m for Ken Paxton, before Texas turned blue.
- Gina Hinojosa, Texas’s governor-elect, campaigned heavily against data centres and pledged a moratorium on new construction, while Democrats across the US campaigned to slow AI and dozens of data-centre measures appeared on ballots.
- Susannah Streeter, chief investment strategist at Wealth Club, described “fresh panic over the AI trade,” saying doubts about returns on vast infrastructure spending had collided with the prospect of a sharp slowdown in data-centre construction; investors were also weighing bubble-correction concerns.
- Greg Brockman, OpenAI’s president and co-founder, said technology leaders were surprised by the data-centre backlash and called for companies to engage communities in Texas, Georgia and elsewhere instead of merely announcing that infrastructure would be good for them.
- Dina Powell McCormick, Meta’s president, said the AI industry needed to “double and triple down” on telling its story and put more effort into selling AI as a good idea.
Why it matters: Data-centre-exposed chipmakers bore the immediate damage: Nvidia lost more than $400bn, while AMD and Micron each fell over 17%. Beyond valuation losses, dozens of data-centre measures were on ballots and a Texas construction moratorium was pledged, confronting investors already questioning whether vast AI spending will pay off.
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