# Nasdaq recovers from AI-driven rout as tech stocks rebound

> Nasdaq rebounds 1.5% after AI stocks see buying amid election-driven market fears.
- Title: Nasdaq recovers from AI-driven rout as tech stocks rebound
- Summary: Nasdaq rebounds 1.5% after AI stocks see buying amid election-driven market fears.
- Keywords: nasdaq, ai stocks, democratic wins, data center slowdown, stock market, election impact, tech correction, market recovery, CNBC
- Source: CNBC — https://cnbc.com/2026/11/05/stock-market-today-live-updates.html
- Author: Sean Conlon,Jenni Reid,Lee Ying Shan,Paulina Likos
- Published: 2026-11-05T23:03:37+00:00
- Read time: 3 min
- Topics: nasdaq, ai stocks, democratic wins, data center slowdown, stock market, election impact, tech correction, market recovery, business, finance
## 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%.
## Key takeaway

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.