From CNBC · Sean Conlon,Jenni Reid,Lee Ying Shan,Paulina Likos · · 3m
Nasdaq recovers from AI-driven rout as tech stocks rebound
Nasdaq rebounds 1.5% after AI stocks see buying amid election-driven market fears.
In brief
Nasdaq rebounds 1.5% after AI stocks see buying amid election-driven market fears. Nasdaq Composite rose 1.5% Friday as AI stocks rebounded after Thursday's 5.5% drop, following Democratic election wins that sparked data center slowdown concerns. Originally reported by CNBC.
Nasdaq drops 5.5% Thursday
The Nasdaq Composite tumbled 5.5% Thursday, closing more than 10% below its most recent high and entering correction territory.
S&P 500 and Dow fall sharply
The S&P 500 lost 4.4% Thursday, while the Dow fell more than 1,800 points, or 3.4%, sending all three major averages into their worst one-day losses since April 2025.
AI stocks lead decline
All 11 sectors in the S&P 500 closed lower, but shares of companies tied to the AI build-out led the decline.
Magnificent Seven shed $1 trillion
The 'Magnificent Seven' stocks shed $1 trillion in total market capitalization Thursday alone, with Nvidia, Tesla, Meta Platforms, and Alphabet seeing gains Friday.
Texas Governor-elect Hinojosa comments
Governor-Elect Gina Hinojosa of Texas said, 'We will have laws to protect Texans, and we need to stop what we are doing with data centers until we have those protections.'
“We will have laws to protect Texans, and we need to stop what we are doing with data centers until we have those protections.”
Market strategist optimistic on AI
Bank of America analyst Wamsi Mohan said the AI sell-off is due to valuation compression, not earnings revisions, and the market may see short-term decompression.
Microsoft reduces neocloud partners
Microsoft is planning to reduce the number of neocloud partners, according to CNBC reports, after the company shut down rented computing capacity from Oracle.
October jobs report beats expectations
The U.S. economy added 165,000 jobs in October, much more than expected, with the unemployment rate slipping to 4.1%.
Nasdaq rebounds 1.5% Friday
The Nasdaq Composite rebounded 1.5% Friday as some investors bought the dip in chip stocks following Thursday's sell-off.
Nvidia and Micron recover
Nvidia rose 2% after a 9% drop Thursday, while Micron Technology gained 3% following a 17% decline.
AI sell-off due to data center concerns
Worries of a potential slowdown in data center construction following big Democratic wins in the House and Senate hit U.S. markets hard on Thursday.
Market analysts see short-term correction
Analysts note that tech stocks often find their footing over the next three-to-six months, but trading remains rocky in the near term.
Trump supports AI despite election concerns
President Donald Trump said he is 100% in favor of the artificial intelligence build-out, stating, 'They are GOLD, and only foolish leadership will say "NO" to the riches they bring!'
“They are GOLD, and only foolish leadership will say "NO" to the riches they bring!”
Oil prices fall amid Iran conflict fears
Oil prices are set for a 12% weekly drop as investors weigh the risk of renewed military escalation between the U.S. and Iran following the midterm elections.
S&P 500 energy lags
The S&P 500 energy sector is heading for a nearly 12% loss week to date, almost double the week-to-date loss of the second-worst performer: information technology.
Market recovers from AI rout
The Nasdaq Composite reversed course from Thursday's rout, rising 1.1% Friday morning while the S&P 500 gained 0.3%.
What to remember
Nasdaq Composite rose 1.5% Friday as AI stocks rebounded after Thursday's 5.5% drop, following Democratic election wins that sparked data center slowdown concerns.
