Major tech stocks drop after US midterm elections prompt AI scrutiny

Major technology stocks experienced a severe selloff after the US midterm elections raised concerns about potential government scrutiny on artificial intelligence development. The BBC reported that Democratic election campaigns focused on slowing artificial intelligence, leading to investor fears over stricter regulations on data centre construction. [1]

The tech-heavy Nasdaq composite index fell by more than 5.5 percent. According to data from Dow Jones cited by the BBC, the decline erased an estimated $2.5 trillion in market capitalisation, marking the worst single-day performance for key US stock indexes since 2025. [1]

This market decline follows earlier volatility in global technology shares. As FTMQ Business reported earlier, Asian stock markets dropped after Wall Street tech declines led to a 3.5 percent fall in the Nasdaq 100, while the Philadelphia Semiconductor Index dropped 7.2 percent. [3]

The downturn impacts major American technology firms that rely heavily on digital services and infrastructure. Menlo Park-based Meta Platforms operates major platforms including Facebook, Instagram, WhatsApp, Messenger, and Threads, relying on advertising network revenue for 97.8 percent of its total income as of 2023. [2]