Summary:
The Nasdaq Composite plunged 5.52% on November 5, 2026, as concerns over AI infrastructure spending and potential regulatory restrictions triggered a Wall Street selloff. Semiconductor stocks, including Nvidia, AMD and Micron, suffered steep losses amid growing uncertainty.
US equity markets took a dive on Thursday, November 5, 2026, as concerns about artificial intelligence investments and possible regulatory restrictions caused technology stocks to plummet across the board.
The Nasdaq Composite plunged 5.52%, entering correction territory. The S&P 500 and Dow Jones Industrial Average also suffered significant losses.
Semiconductor stocks came under the most intense selling.
Wall Street Takes Its Biggest Dive in Months
US stocks closed sharply lower Thursday, snapping a rally from the prior trading session.
The Nasdaq Composite fell 5.52%, or 1,421.52 points, to 24,315.00. That was its biggest one-day percentage drop in about 19 months.
The S&P 500 dropped 4.36% to 7353.73 and the Dow Jones Industrial Average lost 1833.06 points, or 3.44%, to finish at 51523.06.
The Russell 2000 index also fell about 4.4%, with losses among smaller U.S. companies.
The fall wiped out some $3 trillion in market value of S&P 500 companies.
Trading on US exchanges was unusually busy with around 26.9 billion shares changing hands.
Why Are Tech And AI Stocks Crashing?
Renewed concerns about the financial returns from the massive investments in artificial intelligence infrastructure were blamed for the selloff.
Technology giants have poured billions of dollars into cutting-edge processors, data centers, electricity infrastructure and computing capacity.
These investments are capital intensive upfront and their future profitability is dependent on the continued demand for AI services.
Those fears intensified after the US midterm elections handed control of Congress to the Democratic Party.
The election result has added uncertainty around possible restrictions on building data centers, especially in places where there is opposition to large infrastructure projects.
Any deceleration in data center expansion could impact demand for semiconductors, networking equipment and electricity infrastructure.
Higher financing costs were another worry, as some tech companies have relied on debt funding to fuel growth.
Why Semiconductor Stocks Fell Apart
Some of the biggest drops were in chipmakers.
Nvidia (NASDAQ) was down about 9.3%, and Advanced Micro Devices (NASDAQ) was down around 17.3%.
Memory-chip makers felt the selling pressure, with Micron Technology (NASDAQ: MU) falling about 17.5%.
Qualcomm (NASDAQ: QCOM) fell nearly 9.5% after its quarterly results, which included weaker-than-expected smartphone chip sales.
The Philadelphia semiconductor index fell more than 12%, indicating the pressure on companies associated with demand for AI hardware.
Other tech firms also fell.
Meta Platforms (NASDAQ: META) fell about 4% while Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOGL) each fell about 2.2%.
The selling spread to operators of data centers, suppliers of technology infrastructure and electricity-related businesses.
Nasdaq Enters Correction Territory. What Happens Now?
The Nasdaq finished more than 10% below its October 6 record, the widely used definition of a market correction.
International equities also suffered, particularly Asian markets with substantial exposure to semiconductor production.
SEOUL/TOKYO, Sept 18 (Reuters) - Technology-linked shares in South Korea and Japan were sold off heavily on Friday.
Thursday's drop left the Nasdaq slightly down for the year, but still up around 4.6% for the 2026 calendar year.
Corporate earnings, capital expenditure plans, interest rates and US technology regulation developments will drive the markets in the coming days.
The selloff highlighted how quickly market valuations can change when the expected returns on AI investments come under pressure.
Tech stocks remain sensitive to spending announcements and uncertainty on future demand for now.
