Originally published on The Daily Flare.
US technology shares have swung sharply since Democrats won control of Congress in the Nov. 3 midterms, as investors weigh possible AI and data-center restrictions.
In an update published Monday, Nov. 9, NHK said tech shares had fallen heavily on Thursday, Nov. 5, then recovered some ground the following day. The outlet reported that investors remained cautious, with market sources expecting instability to continue for the time being.
Democrats regained control of both chambers of Congress, and Democratic candidates also won governors’ races, including in Texas, a state with many data centers. NHK said investors were concerned the results could lead to tighter rules for artificial intelligence and data-center projects. Those remain concerns about possible future policy, not evidence that new restrictions have been enacted.
The Nasdaq, which is heavily weighted toward technology companies, fell more than 5.5% on Nov. 5, according to AFP, its steepest percentage decline in a single day since April 2025. The S&P 500 dropped more than 4%, while the Dow Jones Industrial Average fell more than 3%. NHK also reported that the Nasdaq had tumbled by over 5%.
The sell-off extended to semiconductor shares. AFP said the Philadelphia Semiconductor Index had fallen about 16% over the week, putting it on course for its worst run since April 2025. In Asia on Friday, Seoul’s Kospi closed 6% lower after briefly dropping almost 9%; chipmaker SK hynix lost more than 10%, while Samsung fell 6.4%. Tokyo’s Nikkei 225 dropped 6%, with SoftBank down more than 10%. Taiwan’s Taiex fell about 4.7%, pulled lower by a similar decline in TSMC shares.
US shares showed signs of a partial rebound on Friday, Nov. 6. The BBC reported that Nvidia rose more than 7% when US trading reopened, while shares in SpaceX gained 6.19%. AMD and Micron also edged higher. The BBC noted that the gains did not make up for the previous day’s losses, leaving investors to assess whether the moves reflected a temporary market swing or a reassessment of the industry’s prospects.
Policy concerns have focused in part on opposition to new data centers. Several midterm winners pledged to slow their construction, AFP reported, and progressive Senator Bernie Sanders called for a national moratorium. Texas governor-elect Gina Hinojosa campaigned on a pledge to pause construction of new facilities in her state. These proposals have added to market uncertainty; they are not federal or state restrictions already in force. The debate follows other coverage of Democratic AI proposals.
Local concerns cited in the BBC’s reporting include the electricity and water consumed by data centers, as well as noise, land use and disruption. A Gallup poll published in May found that 71% of Americans would oppose a data center being built in their community. The BBC reported that some Democratic candidates responded to that public scepticism by calling for clearer rules for businesses and limits on expansion.
Investors were also weighing the financial risks of the buildout itself. AFP reported that companies had committed hundreds of billions of dollars to the sector, while questions persisted over when those investments would generate returns. Higher borrowing costs added to concerns about companies’ financial positions. NHK said emerging data-center firms, which have relied on loans to expand, could face funding difficulties if stricter rules delay new construction projects.
Top comments (1)
Great, in more than one way:
let the overheated stock market cool off a bit, and slowly release some air from the bubble - better than to keep inflating it, and have it explode at some point (with huge fallout)
and slow down the datacenter construction craze, and the threat of the AI juggernaut wiping out a gazillion jobs - let things settle down (and slow down) a bit, so that we can all breathe and come to our senses!
I see nothing negative about this, especially not for ordinary people who make a living by doing 'normal' work, rather than off the back of a surging stock market ...