# Wall Street Routs AI Investments > Wall Street loses $5.7 trillion as AI bets unwind. - Title: Wall Street Routs AI Investments · The Economic Times - Summary: Wall Street loses $5.7 trillion as AI bets unwind. Wall Street lost $5.7 trillion in value since October 6 as AI investments unwind. - Keywords: wall street, ai investments, stock market rout, s&p 500, nasdaq 100, federal reserve, trump administration, ai boom, market volatility, investment losses, The Economic Times - Source: The Economic Times — https://economictimes.indiatimes.com/markets/us-stocks/news/wall-street-grapples-with-5-7-trillion-rout-as-ai-bets-unwind/articleshow/135628032.cms - Author: Bloomberg - Published: 2026-11-07T06:01:00+00:00 - Read time: 1 min - Topics: wall street, ai investments, stock market rout, s&p 500, nasdaq 100, federal reserve, trump administration, ai boom, market volatility, investment losses, money, business ## Wall Street Unrest Wall Street grapples with $5.7 trillion rout as AI bets unwind. > Months of unease over Wall Street’s artificial-intelligence boom erupted into a global market convulsion this week ## Market Volatility US stocks lost $5.7 trillion since Oct 6 peak with 57% of Nasdaq 100 constituents down 20% or more. > By Thursday’s close, the US stock market had lost $5.7 trillion in value since its Oct. 6 peak ## Political Threat Democratic sweep of Congress raises prospect of AI data-center restrictions. > But the Democratic sweep of Congress has added a new political threat, raising the prospect of restrictions on the vast data-center buildout underpinning the boom ## Investor Reactions Portfolio managers warn of winners and losers in AI investment frenzy. > There are going to be losers, and not everybody who’s investing all of this money in capex is going to be a winner ## Retail Traders Retail traders joined selling at pace rarely seen since pandemic. > Even retail traders, normally eager to buy market dips, joined the selling at a pace rarely seen since the pandemic ## Hedge Fund Impact Hedge funds reduced leverage by most in over a decade as AI bets unwind. > Morgan Stanley data show hedge funds have reduced gross leverage from its June peak by the most in more than a decade ## Oil Price Drop Oil prices plunged on hopes Iran war will wind down. > Oil prices have plunged on hopes that the Iran war will wind down ## Market Rotation Investors rotated to utilities and consumer staples before AI rout. > Investors had begun rotating toward cheaper, less glamorous sectors like utilities and consumer staples well before the election ## Quantitative Strategy Societe Generale’s quantitative research traces turmoil to AI and oil positions. > Andrew Lapthorne, Societe Generale’s head of quantitative research, traces much of the turmoil to crowded positions built around AI and oil ## Investor Resilience Some investors exited AI holdings before market rout. > Jeff Muhlenkamp exited almost all his fund’s AI holdings before the rout ## Federal Reserve Outlook Fed expects rate increase in December amid market turmoil. > The Fed remains focused on inflation, with traders betting on another interest-rate increase in December ## AI Investment Pace BlackRock CIO warns AI spending pace must slow for stability. > The aggressive speed of the AI spend, you have to assume that will be at a more deliberate pace ## Key takeaway Wall Street lost $5.7 trillion in value since October 6 as AI investments unwind.