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- November 6, 202612°
- BIST10011,266-0.59%
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- INTEREST36.00%-1.00
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- November 6, 202612°
AI sell-off hits US stocks as Nasdaq enters correction territory
The Nasdaq Composite fell as much as 5.5% during the session amid concerns that the Democrats’ midterm victory could slow artificial intelligence and data center investments; more than $2 trillion was wiped off market value in a sell-off led by chip stocks.
Technology and artificial intelligence stocks faced heavy selling in US markets on Thursday. The tech-heavy Nasdaq Composite fell as much as 5.5% during the session, dropping more than 10% below its record high from October 6 and entering correction territory. The index is heading toward its worst day in five months.
By midday, the S&P 500 was down 3.4%, the Dow Jones Industrial Average had fallen 2.6% and the Nasdaq 100 had declined 5.2%. The selling wave wiped more than $2 trillion off the market value of US stocks.
Semiconductor companies led the decline. AMD, which announced its most profitable quarter in history a few days ago, fell about 13%, while Micron dropped more than 12%, Qualcomm declined 10%, Intel 8% and Nvidia around 7%. The Philadelphia Semiconductor Index fell more than 9%, reaching its lowest level since mid-April. Tesla shares also declined by more than 10%.
Investors are pricing in the possibility that Democrats, who won both chambers of Congress in the November 3 midterm elections, could tighten rules for artificial intelligence and slow data center investments. Democratic Representative Yassamin Ansari had called on November 4 for a pause in the development of advanced artificial intelligence until sufficient regulations were put in place. The Nasdaq had risen 1.44% the day after the midterm elections.
Sales pressure was also intensified by Qualcomm’s smartphone chip revenue in the fourth quarter of its fiscal year falling 26% from the same period a year earlier to $5.14 billion.
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