Nasdaq plunges 5.52% in worst day since April 2025 as AI sell-off wipes out post-election rally
Wall Street's post-election rally lasted a single day as the Nasdaq fell 5.52% on Thursday, its worst session since April 2025, with chip stocks leading a rout that pushed the index into correction territory.
Wall Street suffered its worst day in more than a year on Thursday, 5 November 2026, as a ferocious sell-off in artificial intelligence and chip stocks erased the entire post-election rally in a single session. The Nasdaq Composite plunged 5.52 percent, its steepest one-day fall since April 2025, and closed in correction territory, more than 10 percent below the record high it set on 6 October.
The S&P 500 fell 4.36 percent to 7,353.73, its sharpest daily decline since President Donald Trump’s tariff announcement in April 2025, according to the Associated Press. The Dow Jones Industrial Average dropped 1,833.06 points, or 3.44 percent, to 51,523.06. All three major indexes recorded their worst day since April 2025.
The whiplash was the story of the week. Just a day earlier, on the first trading day after the midterm elections on 3 November, the Dow had jumped 1,569.40 points, or 3.03 percent, to 53,356.12, its best day since 9 April 2025, while the S&P 500 rose 1.58 percent and the Nasdaq gained 1.44 percent. Thursday’s rout wiped out those gains and more, leaving traders stunned by how quickly the mood had turned.
The damage was concentrated exactly where the artificial intelligence boom lives: semiconductors, memory chips and the companies building data centres. Nvidia, the chipmaker at the centre of the AI boom, tumbled 9.26 percent to $181.60, losing almost $450 billion in market value in a single session, according to CNBC. Advanced Micro Devices plunged 17.3 percent, Micron fell by a similar amount, and SanDisk dropped more than 22 percent. The Philadelphia Semiconductor Index crashed 12.25 percent to 9,011.14, a fall of 1,257.52 points, and data-centre builders such as Hut 8, CoreWeave and IREN were among the day’s worst performers.
Reuters reported that roughly $2 trillion was wiped off the Nasdaq’s market value in a single session, while the Kobeissi Letter put the S&P 500’s one-day loss at about $3 trillion. The rout spread beyond equities: bitcoin fell below $76,000, and crypto ETFs recorded heavy outflows on the same day.
The trigger, by the account of analysts quoted in the day’s coverage, was the Democrats’ sweeping victory in the midterm elections. Democrats took control of both houses of Congress and flipped governor’s offices in Texas, Ohio, Georgia and Nevada, while voters backed restrictions on data-centre construction in 40 of 41 local ballot measures. Investors read the results as a signal that the vast build-out of AI infrastructure — the chips, power plants, transmission lines and data centres that have powered the market for two years — could become slower, more expensive and more heavily regulated.
“The obvious catalyst for the sharp selloff is that markets are pricing in the midterm results,” Jakub Rochlitz of eToro said, according to Fox Business. “The market’s interpretation is that the AI infrastructure buildout will become slower and more expensive.” Rising electricity prices had made the fast build-out of power-hungry data centres a campaign issue, with some Democrats calling for limits or pauses on new projects.
Not everyone in the industry accepted the market’s verdict. AMD chief executive Lisa Su said the market was being “a little short-sighted” and that she saw no slowdown in demand for AI chips. No major AI company announced a cancelled product, a lost customer or a broken business on the day of the sell-off, and the selling was driven by a reassessment of future growth rather than by any single earnings miss or policy announcement.
For all the drama, the major indexes remained higher for the year. The S&P 500 was up approximately 7.4 percent in 2026, the Dow had gained 7.2 percent and the Nasdaq remained 4.6 percent higher, according to the Associated Press. The Nasdaq had also slipped below its 200-day moving average, a technical level watched closely by traders, and large-cap technology shares had their worst session since the pandemic sell-off of 2020.
Attention now turns to whether the selling continues or buyers step in to treat the correction as an opportunity. Traders will watch Friday’s trading closely, along with the United States’ October employment report, due later on 6 November, for signs of whether the economy is holding up. If the sell-off deepens, questions will grow about the valuations of the chip and data-centre companies that have carried the market; if it stabilises, the episode may be remembered as a sharp but brief repricing of the AI trade rather than its end.
All figures in this report are from the close of trading on Thursday, 5 November 2026, checked at 13:21 PKT on 6 November 2026.
This post is market news information only, not financial advice.
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