Nasdaq sees worst day in 19 months as investors bet on AI slowdown after Democrats’ election triumph

What happened

The Nasdaq Composite dropped over 5% following the 2026 US midterm elections, where Democrats made significant gains. Investors sold off major tech and semiconductor stocks amid concerns that new Democratic leadership would introduce stricter regulations on AI and data centers. The selloff erased trillions in market value from the US stock market, with the largest tech companies and chipmakers experiencing some of the steepest declines. Global markets also fell sharply in response to the US market downturn.

Key details

• Nasdaq Composite fell 5.5%, wiping out $2.5 trillion in value.
• Major tech stocks, including the 'Magnificent Seven,' lost about $1 trillion collectively.
• SanDisk shares dropped 22%, while Micron and AMD each lost 17%.
• Nvidia stock fell over 9%.
• Japan’s Nikkei index dropped nearly 6%, and South Korea’s KOSPI fell 6.7%.

Why it matters

Investors, tech companies, and chipmakers are directly affected by the sudden drop in stock prices and market value. Companies in the AI sector now face the possibility of increased regulatory requirements and slower approval processes for data center expansion in the US. This could lead to higher costs and delays for firms building AI infrastructure, and investors must reassess the growth potential of AI-related businesses under new political conditions.