technology ·
Fresh AI concerns drag down Nasdaq after midterm bump
5 (UPI) -- The Nasdaq Composite fell by nearly 5% early Thursday and the Dow Jones Industrial Average dropped 1,000 points after a 1,500-point jump on Wednesday.
Stocks in data centers and microchip manufacturing companies tumbled for a second day as Democrats flipping control in both chambers of Congress has ushered in concerns about more stringent regulations on the AI industry. The Nasdaq Composite is home to many of the tech industry's leading stocks.
Shares in leading chip manufacturers Nvidia and Broadcom, as well as software company Oracle, slipped by 9%. Elon Musk's companies Tesla and SpaceX, both headquartered in Texas, both fell by 10%.
Musk donated more than $220 million to support Republican Senate candidate Ken Paxton in Texas, in a losing effort. The drop in the Nasdaq is being viewed by investors as a market correction after a historically strong post-midterm day on Wednesday.
The Nasdaq ended the day up 1.44%. Despite a strong showing by the Nasdaq as a whole on Wednesday, AI stocks largely reacted negatively to the results of the midterms.
