Summary

  • Trillions of dollars have been wiped off the stock value of major tech firms in the US, Europe and Asia amid concerns of a slowdown in AI development

  • It comes after the US midterm elections, in which a number of Democrats campaigned to slow the growth of AI data centres - Gina Hinojosa, who won in Texas, pledged to halt new centre construction entirely

  • The Nasdaq index, of the largest tech firms listed in the US, was down by more than 5.5% by the end of Thursday, losing an estimated $2.5tn (£1.9tn) in market value, according to Dow Jones data

  • Meanwhile, the Nikkei 225 in Japan was 6.3% lower as shares in memory chip maker Kioxia lost almost 11.5% and rival Tokyo Electron slipped by 5.8%

  • For context: Japan, South Korea and Taiwan make most of the memory chips and equipment for US data centres

  • And in the UK the FTSE 100 index has fallen by 1.6% - the lack of tech shares on the London Stock Exchange means it tends to be less exposed to sell-offs in the AI sector, says our business reporter

Live Reporting

Edited by Alex Smith

  1. Midterms caused panic but situation not catastrophic, says UK tech founder

    A drone view shows Microsoft data centre in Middenmeer, NetherlandsReuters

    Tudor Brown, co-founder of the British semiconductor and software company Arm Holdings, says the "pretext of almost infinite AI growth and data centres" was already causing jitters in the run up to the US midterms.

    Speaking to BBC Radio 4's Today programme, he says: "We started to get nervous around about June when people started to worry about the cost of debt, and that was made worse by the interest rate rises."

    Brown says the midterms results have caused a "panic" with fears over the curbing of AI growth, such as limits on building data centres.

    But he adds: "If you stand back... it's not as catastrophic as you might think."

    He concedes that the issue of powering energy-hungry data centres is an issue, but argues that if you accept AI is an important technology that is necessary for "the way we evolve our lives, then data centres have to be built" and are "to some extent, a necessary evil".

    "I think people will reflect and realise that actually there's a lot of money still being made in these companies and we'll start to see it coming back a bit."

  2. FTSE 100 falls 1.6% in early trade
    Breaking

    Nick Edser
    Business reporter

    Shares in London have fallen in early trade, but the drop has not been as heavy as seen elsewhere.

    In the first few minutes of trade, the FTSE 100 index has fallen 177 points, or 1.6%, to 10,608.

    The lack of tech shares on the London Stock Exchange means the index tends to be less exposed to sell-offs in the AI sector.

  3. Tech leaders caught off guard by midterms backlash

    A middle-aged woman with long, dark hair and a cream jacket, gesturing with both hands in front of her.Getty Images

    Meta's president Dina Powell McCormick said the industry needs to put more effort into selling AI as a good idea

    Some tech leaders say they were caught off guard by the backlash against data centres in the midterms.

    OpenAI president and co-founder Greg Brockman said he believed everyone had been surprised by the reaction to data centres, and more work needed to be done to ensure communities were on board.

    "A lot of our shift over the course of this year has really been to realise that from San Francisco trying to build infrastructure in Texas, Georgia, and other places, you can't just tweet and say: 'This is going to be good.' You need to be in those communities," Brockman said at the WSJ Tech conference in Napa, California on Wednesday evening.

    Meta's president Dina Powell McCormick said that the industry needed to put more effort into selling AI as a good idea.

    "I think we need to double and triple down on telling the story," she told the WSJ conference.

  4. Market fears of AI investment slowdown isn't a new thing, says fund manager

    Person holding an umbrella walking past a financial graphic displayEPA Shutterstock

    Obe Ejikeme, global equities fund manager at asset management company Carmignac, says the first response in the markets to the US midterms results was one of "relief".

    But, he adds, it wasn't long before "investors sort of read the small print that concern started to come into the market" - with investors fearing a slowdown in the AI investment cycle.

    Speaking to BBC Radio 4's Today programme, Ejikeme says there has been ongoing concern for a while that investment in AI will slow down.

    "It's not a new thing but I think that's just accelerated given the potential shift in the regime in the US."

  5. Midterms results being seen as a rebuke of AI data centres

    Lily Jamali
    North America technology correspondent

    A section of a data centre, shown as a row of metal boxes against a blue sky.Reuters

    A number of AI data centres - like this one here in Abilene, Texas - have been built in recent years in communities across the United States

    In the US, a trillion dollars was wiped off the value of seven of the world’s biggest tech companies, including Apple, Nvidia and Tesla.

    The losses helped drag the Nasdaq down 5.5 %, pushing it into what markets call "correction territory" - that’s when it falls at least 10% below its recent high.

    In Asia, tech-heavy indexes also fell sharply in early trading, with firms that make computer chips and other equipment that powers AI seeing their shares slide. Trading was temporarily halted in Seoul.

    Ahead of the US midterms, several Democrats campaigned on anti-tech platforms and won.

    Those election results are being seen as a rebuke by voters of AI and the data centres that have been built - or are being planned - in communities across the United States.

  6. Democrats campaigned on slowing growth of data centres and AI

    Texas Democratic governor-elect Gina Hinojosa, a middle-aged woman with long, dark hair and a tan jacked, speaking into a microphone and raising one arm.Reuters

    Texas governor-elect Gina Hinojosa was one of many Democratic candidates who campaigned against AI data centres

    The market reaction follows the Democrats taking control of Congress following the US midterm elections.

    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.

    The Democrats' success sparked concerns from some over a potential slowdown in the development of artificial intelligence (AI) - with investors appearing to be worried about the prospect of tougher regulation.

    Democratic candidates across the US had campaigned on slowing the growth of AI, and on opposition to the data centres that are vital for powering the technology.

    For example in Texas, where governor-elect Gina Hinojosa campaigned heavily against data centres, pledging a moratorium on new construction in the sector.

    US President Donald Trump, by contrast, has publicly backed the technology - even calling for it to be renamed "super intelligence".

    There were also dozens of measures on ballots around the country aimed at restricting the development of the centres.

  7. 'You only have yourselves to blame!' - Trump blames stock plunge on midterms losses

    US President Donald Trump speaks from White House desk - his two hands are in front of his body, gesturing as he speaksReuters

    In a series of posts on Truth Social on Thursday night, US President Donald Trump blamed the stock plunge on his political opponents.

    "The Stock Market suffered one of the Worst Days in History based on the results of the Election. Such a sad thing to watch! It took so much work to get us to a level that no one has ever seen before, and then this," he writes.

    "Remember, it wasn’t Republicans, it was Dumocrats. Do not fear, however, we will soon, one way or the other, be BIGGER AND STRONGER THAN EVER BEFORE."

    In a follow-up post, Trump writes: "The Stock Market crashed today because the Dumocrats had a big Tuesday — So sad to see, you only have yourselves to blame!"

  8. Eyes on Europe as trading in Asia closes

    Osmond Chia
    Business reporter

    All eyes are on Europe to see whether the market sell-off of tech shares will charge on.

    Trading in Asia is just about wrapping up, with tech-heavy indexes like Japan's Nikkei 225 and the Kospi in South Korea each falling by around 6%.

    Shares of major chip firms like SK Hynix fell by 10%, while Samsung tumbled by more than 6%.

    The Taiwan stock market also suffered its biggest weekly decline since 2001, according to LSEG data.

    That comes after the US Nasdaq composite index closed down by more than 5.5% on Thursday, losing an estimated $2.5tn in market value.

    Watch: Seoul correspondent Jake Kwon reports on what we know about the tech stocks plunge in Asia

  9. Global tech stocks plunge over AI slowdown fears after US midterms

    Traders at the US stock exchange.Reuters

    Trillions of dollars have been wiped off the stock value of major tech firms in the US, Europe and Asia after the US midterm elections sparked concerns of a slowdown in artificial intelligence (AI) development.

    Shares in firms across the tech sector plummeted following Democratic wins in Tuesday's midterms.

    A number of Democratic candidates had run campaigns on slowing AI - and there are broader concerns about whether the huge sums being spent on the technology will pay off.

    The tech-heavy Nasdaq composite index closed down by more than 5.5% on Thursday, losing an estimated $2.5tn (£1.9tn) in market value, according to Dow Jones data.

    Other key US stock indexes also saw big losses in their worst days since 2025.

    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 sell-off also hit European chipmakers. In European trading on Thursday, shares in chipmaker Infineon fell by more than 8.5% while tech equipment manufacturer ASML dropped by 6.5%.