The S&P 500 slumped about 3.5%, the Nasdaq sank more than 5%, and the Dow lost nearly 1,500 points on Thursday, erasing the prior session’s gains amid a sharp, post-election selloff in semiconductor stocks. The chip sector was on track for its worst weekly performance since the April 2025 tariff-driven rout.
Democrats secured control of both the Senate and the House of Representatives in the midterm elections and are expected to pursue tighter regulations on computing hubs critical to AI development. Market participants fear such measures could slow infrastructure buildouts and delay deployments that major companies are relying on to drive earnings growth.
Losses were broad-based across the market, but chipmakers bore the brunt of the decline. Nvidia and AMD each dropped more than 7%, while Micron slid over 12.5%. Tesla also tumbled more than 11%, Applied Materials fell more than 11%, and Lam Research sank more than 13%.
Among the hyperscalers, Microsoft declined more than 2.5%, Meta lost over 3.5%, and Oracle plunged 7%.
