A Democratic sweep in U.S. midterm elections triggered a global stock market crash this week as investors feared the new Congress would restrict artificial intelligence and data center construction.
On Thursday, the Nasdaq Composite fell 5.52 percent, its deepest one-day drop in 19 months . The Nasdaq 100 dropped 6.4 percent . The S&P 500 lost 4.36 percent and the Dow Jones Industrial Average fell 3.44 percent . The sell-off wiped out more than $3 trillion in market value . President Donald Trump blamed the Democrats on Truth Social, writing that the market suffered "one of the Worst Days in History based on the results of the Election" .
Investors feared that Democrats, who won control of both chambers of Congress, would slow the buildout of AI data centers. Senator Bernie Sanders called for a national moratorium on data center construction, writing on X that "Americans don't want Big Tech oligarchs wrecking the environment, gutting jobs and threatening humanity's future" . Democrats also won state races, including Gina Hinojosa in the Texas governor's contest .
Asian markets crashed on Friday. Seoul's Kospi index plunged nearly nine percent, triggering a 20-minute trading halt . Tokyo's Nikkei 225 fell about seven percent . Chipmakers led the declines, with SK hynix down 10 percent, Samsung down eight percent, and TSMC down seven percent .
Individual tech stocks suffered heavy losses on Thursday. Tesla fell 11 percent and SpaceX dropped nine percent . Nvidia declined nine percent . Elon Musk, who spent $445 million supporting Republican candidates, saw his companies hit hard . Meta warned that election backlash against data centers could threaten future AI investments .
The crash erased gains from Wednesday, when markets had rallied on relief that the midterms did not leave Congress undecided . The losses affected ordinary Americans through retirement portfolios such as 401(k)s . AI had been a major driver of U.S. economic growth, which expanded 3.4 percent in the July-September quarter .
