Wall Street lost an estimated $3.2 trillion in market value on Thursday as AI stocks plunged following sweeping Democratic victories in the U.S. midterm elections, fueling fears that tighter regulations could slow data center construction.
The Nasdaq Composite sank 5.5%, the S&P 500 fell 4.4%, and the Dow Jones Industrial Average lost 1,833 points. Nvidia dropped 9.3%, erasing more than $400 billion from its market value, while Advanced Micro Devices fell 17.3% and Micron Technology lost about 17.5%. A semiconductor stock index plunged roughly 12%.
The sell-off reversed Wednesday’s rally, when the Dow rose 1,569 points, and the S&P 500 gained 1.6%. Investors initially welcomed the end of election uncertainty and the prospect of divided government before concerns over AI investment took hold.
U.S. midterms deepen AI stock crash over data center limits
Democrats won control of Congress and governorships in key states, including Texas, Georgia and Ohio. The results brought new attention to proposals restricting large data centers, which use vast amounts of electricity and water. Residents have raised concerns about utility bills, environmental effects and the costs of expanding power supplies.
🚨 BLACK THURSDAY CRASH IS HERE.
Over $3.7 Trillion has been wiped out from the global stock markets today.
🇺🇸 US stock market is down -4%, wiping out $3 Trillion.
🇰🇷 KOSPI crashed -5.2%, wiping out $200 Billion.
🇨🇳 Taiwan stock market dumped -5%, wiping out $180 Billion.
🇯🇵… pic.twitter.com/xJasoZVvLt— Crypto Rover (@cryptorover) November 5, 2026
Voters favored limits on data center development in 40 of 41 local ballot contests on Nov. 3. They approved 27 restrictive or opposition measures and rejected 13 proposals that would have supported development. The votes did not impose a nationwide ban.
Texas Gov.-elect Gina Hinojosa, who defeated Republican Gov. Greg Abbott, said, “We will have laws to protect Texans,” while supporting a pause on approvals until safeguards are in place. Abbott had already imposed some restrictions before the election.
The prospect of delayed projects has unsettled suppliers of AI chips, servers and electrical equipment. Investors are questioning when planned construction spending will translate into sales and profits.
Global markets slide as AI investment concerns grow
The industry was under pressure before Tuesday’s vote. Intel’s disappointing October forecast had already shaken chip stocks, while rising borrowing costs and enormous computing commitments raised doubts about the returns on AI infrastructure spending.
The turmoil spread overseas Friday. South Korea’s KOSPI briefly dropped 8.8%, triggering a trading halt, and Japan’s Nikkei fell nearly 6%. U.S. technology shares recovered some ground Friday afternoon, although the rebound did not erase Thursday’s losses.
The sell-off reflected more than the election. High valuations, concerns about financing, and heavy selling by investors seeking to reduce risk added to the decline. President Donald Trump continues to support AI development, and the extent of any future restrictions remains uncertain.
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