US stocks lost an estimated $2.5 trillion in market value on Thursday as investors dumped the AI trade two days after Democrats took control of Congress.
By the numbers: The Nasdaq Composite closed down 5.5%, the S&P 500 fell more than 4% and the Dow gave up more than 1,800 points, each the worst single day since April 4, 2025.
- The Magnificent Seven lost more than $1 trillion in combined market value, with Nvidia alone shedding almost $450 billion and turning negative for 2026.
- Micron and AMD each fell 17%, SanDisk dropped 22% and the Philadelphia Semiconductor Index lost more than 12%.
The backstory: Democrats campaigned on slowing data center construction and then won the House, the Senate and statewide races in Texas, Ohio and Georgia, three of the states with the most ambitious AI buildout plans.
What they're saying: "The technology is still going to continue on in terms of its development, but if there is a slowdown in the actual development and the buildings and the infrastructure and so forth, that’s what stocks are going to trade off," said Peter Boockvar, chief investment officer at OnePoint BFG Wealth Partners.
What's next: Asia followed on Friday: Japan’s Nikkei 225 fell 6.3%, Taiwan’s Taiex dropped 4.5% for its biggest weekly decline since 2001, and South Korea’s Kospi slid more than 8% and triggered a circuit breaker.
Why it matters: About 35% of S&P 500 companies now sit at least 20% below their 52-week high, so the damage reaches well past chip stocks into any 401(k) holding a broad US index fund.
