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Economy

Nasdaq Drops 3% as Chip Stocks Plunge a Day After Post-Election Rally

The Nasdaq fell about 3% in Thursday morning trading as chipmakers led a broad sell-off, giving back part of Wednesday's post-election gains, with AMD down 12% and Nvidia down 5%.

By admin Nov. 5, 2026 · 10:42 AM ET 2 min read

The New York Stock Exchange building on Wall Street, with pedestrians walking past on the sidewalk.

U.S. stocks fell sharply on Thursday, with the Nasdaq Composite down about 3% in morning trading as a sell-off in chipmakers and companies tied to the artificial intelligence buildout deepened a day after Democrats swept the midterm elections.

At 9:57 a.m. ET, the Nasdaq was down 795.08 points, or 3.09%, at 24,941.44, according to Reuters. The S&P 500 lost 127.74 points, or 1.66%, to 7,560.88, and the Dow Jones Industrial Average fell 351.87 points, or 0.66%, to 53,004.25. The decline left the Nasdaq on course for correction territory, according to Reuters.

Traders seen from behind on a stock exchange floor, facing large electronic boards showing red declining market charts.
Traders seen from behind on a stock exchange floor, facing large electronic boards showing red declining market charts.

Chipmakers lead the drop

Chip stocks were at the center of the selling. Qualcomm fell about 10% in early trading, according to Investopedia, after the company gave a weak outlook for fourth-quarter smartphone chip sales, citing sluggish demand and lower revenue tied to Apple. Nvidia fell about 5%, Advanced Micro Devices dropped 12%, Intel lost 8% and Broadcom fell 5%. Memory chip makers also fell hard: Micron and SK Hynix plunged, while SanDisk and Seagate each dropped more than 12%. The Roundhill Memory ETF was down 8%, the iShares Semiconductor ETF slid 7%, and the broader semiconductor index was down 7.1%.

A close-up of a computer processor chip mounted on a green circuit board.
A close-up of a computer processor chip mounted on a green circuit board.

AI infrastructure stocks fall too

The selling spread beyond chipmakers. Data center operators IREN, Hut 8 and Applied Digital fell between 6% and 11%, while CoreWeave dropped 9.3% and Nebius Group shed 13.4%, Reuters reported. AI server maker Dell fell 10.5%. Tesla fell 9.5% and SpaceX fell 6.7%. Both had also fallen on Wednesday. Meta Platforms slid 3.4%, while Amazon and Alphabet were slightly lower.

Investors are weighing whether the Democratic sweep will bring tighter regulation of the AI data center buildout, Reuters reported. “There is now a chance that the two years of extra push from the Trump government for AI buildout will somehow be scaled back,” Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, told Reuters. “We suspect there is going to be some scrutiny on this aggressive AI buildout.”

A worker in a white protective suit and hood holding a silicon wafer in a semiconductor cleanroom.
A worker in a white protective suit and hood holding a silicon wafer in a semiconductor cleanroom.

The losses came a day after a broad rally. The Dow jumped nearly 1,600 points on Wednesday after the election results, according to Investopedia, while the Nasdaq also rose that day.

In other markets, oil prices rose after plunging on Wednesday. West Texas Intermediate crude futures were up 2.2% at $90.10 a barrel, gold futures rose 0.7% to $4,100 an ounce, and bitcoin traded at $78,400, down from above $81,000 a day earlier, according to Investopedia. The yield on the 10-year Treasury ticked lower to 4.87%.

Snap fell 12% after missing third-quarter revenue estimates, while AppLovin jumped 32% after beating third-quarter profit estimates, Reuters reported. Declining stocks outnumbered advancing stocks by 2.17 to 1 on the Nasdaq and 1.36 to 1 on the New York Stock Exchange. Investors now turn to the October jobs report due Friday, with traders expecting the Federal Reserve to raise rates next month after a September increase, Reuters reported.

Reporting based on coverage by Investopedia and Reuters.

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