Wall Street stocks steadied on Friday following a $3.2tn rout triggered by fears that a Democratic victory in the US midterm elections would curb AI infrastructure expansion. The Nasdaq 100 rose 1.4 per cent after plunging 6.4 per cent the previous day, its worst drop since 2020, while the S&P 500 gained 0.3 per cent after falling 4.4 per cent on Thursday. Investors dumped tech shares over concerns about data centre restrictions, particularly after Democrat Gina Hinojosa won the Texas governorship — a key hub for data centres.
However, Hinojosa later clarified her moratorium would only affect new permits and be temporary, easing market anxiety. The S&P 500 recouped less than 10 per cent of Thursday’s losses, far below the historical average of 46 per cent, highlighting the feebleness of the rebound. Nvidia, which lost over $400bn in market value, rose 2.8 per cent, while Micron gained 5.1 per cent.
Analysts attributed the volatility to forced hedge fund selling and warned the speed of the market’s reaction was irrational. Asian and European markets also fell, with Japan’s Nikkei and South Korea’s Kospi each dropping 6 per cent.
Source: Financial Times Markets · Summarized by HeadlinesBriefing