Investors pulled out of technology stocks for the second consecutive day after Democratic victories in the midterm elections cast a shadow over the construction of AI data centers.US stocks All four major indices fell in early trade. The Philadelphia Semiconductor Index fell 7%, and TSMC ADRs also fell nearly 7%. The S&P 500 fell 1.7% and the Nasdaq Composite fell 3%.
Investors are concerned that Democratic Party victories in both houses of Congress and several key gubernatorial elections could increase regulatory pressure on the build-out of AI infrastructure across the United States.
Share prices of major chip makers Nvidia (also translated as NVIDIA) and Broadcom fell nearly 5% in early trading, and software companies such as Oracle also fell more than 4%. Additionally, Musk’s Tesla fell nearly 10%,spacex Down 5% Qualcomm, another major chip maker, reported better-than-expected financial results, but its share price fell 8% due to disappointing financial forecasts. Memory maker Micron Technology fell 10%.
Share prices of emerging cloud computing players also declined, with CoreWave falling 10%, Nebius and Irene falling 11% and 9% respectively.
“As investors digest the election results and potential policy implications, the market could face more severe volatility,” said Watson, a portfolio manager at Tandem Investment Consulting Co. “This reminds the market to rationally examine the vast funds invested in building AI infrastructure and whether these investments can generate the returns expected by investors.”
