Tech stocks plunge as midterms threaten AI datacenters

The Nasdaq fell about 5.2% and the semiconductor index posted its worst day since March 2020 after Democratic midterm wins and voter-approved measures curbing US AI data center buildout. Analyst Dan Ives now expects hyperscaler capex growth to peak in 2027 and says at least 10% of the planned 800-1,000 US AI data centers could be wiped off the roadmap.

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The Nasdaq dropped about 5.2% midday, erasing over $3 trillion in market cap, in its biggest one-day fall since April 2025. Chip stocks were hit hardest, with Nvidia down 8% and Micron and AMD each down about 14%. Neocloud operators with heavy debt, such as CoreWeave, fell 9% on Thursday and 18% over two days. Ives now sees capex growth peaking in 2027 rather than 2028-2029, and Meta's president said hyperscalers are weighing building outside the US. Software, gig-economy and streaming names also sold off, though one wealth manager called it a possible short-term overreaction.