Wall Street and Asian and European markets dropped after Democrats' midterm victory raised concerns about tighter scrutiny of AI and data center construction. The Nasdaq fell 5.5% on Thursday, its worst day in 19 months.
Global stock markets fell after the US midterm elections, as investors worried that Democratic victories could lead to tighter scrutiny of artificial intelligence and slower expansion of data centers.
On Thursday, the Nasdaq share index had its worst day in 19 months after slumping 5.5%. The S&P 500 Index plunged 4.4%, while the Nasdaq 100 slid 6.4%. Chip stocks led the slump, with SanDisk tumbling by 22% and Western Digital falling by 17%. Wall Street's "fear index", the Vix, jumped by 61% to its highest levels since the early weeks of the Iran war.
Asian markets fell sharply on Friday. Japan's Nikkei 225 index sank 6% and South Korea's Kospi index tumbled more than 8% in early trading. Hong Kong's Hang Seng fell 0.7% to 24,630.03. The Shanghai Composite dipped 1.3% to 3,642.10.
European markets also opened lower. The FTSE 100 was down 1.5%, or 166 points, at the start of trading to 10,615. Germany's Dax index opened down 1.5%, France's Cac 40 dropped by 1.2% and Spain's Ibex was down 1.1%.
US President Donald Trump blamed the plunge on his opponents, claiming that the stock markets had seen "one of the worst days in history based on the results of the election." "Remember, it wasn't Republicans, it was Dumocrats," he added in a post on Truth Social.
Several newly elected Democrats campaigned against data centers. Texas' Democratic governor-elect Gina Hinojosa campaigned heavily against data centers, promising a moratorium on new construction in the sector. South Carolina Senator-elect Annie Andrews said she was standing for "a South Carolina where decisions about our communities are made by the people who live in our communities, not the billionaires or data center companies in Washington, DC." New Hampshire Senator-elect Chris Pappas said that "big data centers" were causing harm to the state's communities and their well being. Virginia Democrat Mark Warner said AI safety was "too important" to be left to "tech bros" and President Donald Trump. Ohio Senator-elect Sherrod Brown said, "I do not work for data centers."
Investors are concerned that curbs on data center construction could slow AI infrastructure spending and reduce returns on AI investment. Despite the sharp losses, most indices remain up for the year: the Nasdaq Composite is still up 4.6% since the start of January, and the FTSE 100 has gained almost 6.9% in 2026.
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
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