Global tech stocks plunge as US midterms add to AI slowdown fears

Image source, Bloomberg via Getty ImagesByRachel Clun, Reporting fromNew York and Osmond Chia, Reporting fromSingaporePublished5 November 2026Updated 1 hour agoHundreds of billions of dollars in market value has been wiped from major tech firms in the US and Asia in a stock market rout after the US midterm elections sparked concerns of a slowdown in artificial intelligence development.

Shares in firms across the tech and AI sectors plummeted following Democratic wins after election campaigns run on slowing AI.

The tech-heavy Nasdaq composite index closed down by more than 5.5%, losing an estimated $2.5tn (£1.9tn) in market value, according to Dow Jones data, while other key US stock indexes also saw big losses in their worst days since 2025.

The sell-off comes on top of broader concerns about whether the huge amounts being spent on AI will pay off.

In Asia, tech-heavy indexes fell sharply on Friday morning as firms that make the computer chips and other equipment that power AI saw their shares slide.

The Nikkei 225 in Japan was 6% lower in early trading as shares in memory chip maker Kioxia lost over 12.6% and rival Tokyo Electron slipped by 9.5%.

South Korean chipmaker SK Hynix fell by more than 11.5%, while Samsung was down by nearly 10%.

The sell-off in Seoul sent the Kospi index plunging more than 8.5%, triggering a so-called circuit breaker, a mechanism that temporarily halts trading to curb panic selling.

Taiwan's Taiex dropped by more than 8.3%, with chipmaking giant TSMC falling by nearly 8.5%.

It marks a "continuation of worries" over the level of spending on AI infrastructure, said MarketWatch chips analyst Britney Nguyen.

Democrats in races across the US campaigned to slow the growth of data centres and AI, and there were dozens of measures on ballots around the country aimed at restricting the development of the hubs crucial for powering the technology.

They won both the US Senate and House of Representatives in Tuesday's midterms, taking control of Congress for the rest of President Donald Trump's presidency.