Tech stocks plunge over AI concerns after Democrats' midterm wins

Tech stocks experienced significant declines following the midterm elections, with concerns rising that a shift in Congressional control could slow the development of data centers crucial to artificial intelligence, CBS News reported.

The Nasdaq 100 index dropped 6.3%, wiping out $2.3 trillion in market value, while the S&P 500 fell 4.4%, erasing $2.8 trillion, according to NBC News. This marked the worst single-day drop since April 2025.

Investors reacted to the unexpected scale of Democratic victories, including candidates who pledged to regulate AI data centers, particularly in key markets like Texas, NBC News noted. Hundreds of such candidates were elected, raising prospects of increased industry regulation.

The broader Nasdaq Composite index fell more than 5.5%, entering correction territory with a decline of at least 10%, as investors reassessed risks to the AI sector's growth potential, NBC News added.

Democrats aim to secure additional Senate seats in Mississippi and Alaska, which could further influence policy on AI and technology infrastructure, CBS News reported.