Tech stocks slide on Wall Street as investors weigh Democratic midterm gains and AI spending
Technology stocks led a steep sell-off on Wall Street on November 5, 2026, pushing the Nasdaq Composite, an index heavy with tech companies, into what markets call correction territory, meaning a fall of 10% or more from a recent peak. The index slipped 3.2% to 24,796.06 points, according to the Miami Herald. At one point it had been down as much as 5.5%, CNN reported. Its record closing high was 27,599.89, reached on October 6.
Analysts attributed the sell-off to expectations that Democratic governors would crack down on new data centres after winning gubernatorial races, the elections for state governor. Data centres are large buildings filled with computer servers that run artificial intelligence and online services. Analysts also pointed to voters rejecting data centres in local ballots. The Guardian reported that the Nasdaq was on track for its worst day in 18 months.
The chip sector took the heaviest losses. Semiconductor stocks plunged as investors grew sceptical about the artificial intelligence trade following the Democrats' performance in the midterm elections, the national votes held halfway through a US president's term. SanDisk shares tumbled 19%, and Western Digital fell 16.5%. Nvidia dropped 6.7%, making it the biggest faller on the Dow Jones Industrial Average, while Goldman Sachs shares fell 5.7%.
Reuters reported that the Nasdaq 100 was tracking toward a loss of about $1.8 trillion in value as the Democratic win raised fears of delays to AI expansion.
The sell-off spread beyond technology. The Dow Jones fell more than 1,500 points, or 2.8%, to 51,868 in early afternoon trading, and the S&P 500 was down 3.7%. The VIX, a measure of expected market swings often called Wall Street's fear index, jumped 40%, to its highest level since the early weeks of the Iran war.
The Guardian also reported that the Nasdaq's decline was heading for its biggest one-day fall since Donald Trump announced his "liberation day" tariffs, taxes on imported goods, in April 2025.
In London, the FTSE 100 closed down 46 points, or 0.4%, at 10,782.66.
