AI stock sell-off sends Wall Street reeling and erases midterm rally gains
Wall Street experienced a significant sell-off in AI-related stocks, driven by concerns over the high costs of data center infrastructure and potential regulatory hurdles following U.S. midterm election results. Major tech companies like Nvidia and AMD saw sharp declines.
Why it matters
The market volatility reflects growing investor anxiety regarding the sustainability of the AI infrastructure boom and the impact of political shifts on tech spending.
Another wipeout for stocks tied to the buildout of AI data centers is overwhelming Wall Street on Thursday and more than erasing all its gains from the day before, which was its best in three months.
The S&P 500 fell 3.5 per cent after opening with a loss that accelerated through the morning. It’s on track for its worst drop since President Donald Trump shook markets worldwide in April 2025 after announcing his “Liberation Day” tariffs.
The Dow Jones Industrial Average was down 1,433 points, or 2.7 per cent, as of 12:26 p.m. Eastern time, and the Nasdaq composite was 4.7 per cent lower.
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