Chip stocks tumble after midterms, dragging Nasdaq to its steepest slide since April 2025

Chip stocks crashed Thursday, pulling the Nasdaq down 5.5% and marking its steepest slide since April 2025. Nvidia and Qualcomm each fell more than 9%, with Nvidia wiping out almost $450 billion of market value. The drop followed midterm election results that gave Democrats control of key state governments and a Senate sweep, raising fears that AI‑related spending will slow. CoreWeave, a neocloud provider, tumbled for a second straight day. Peter Boockvar, chief investment officer at OnePoint BFG Wealth Partners, warned that while AI technology will keep advancing, a slowdown in building data‑center infrastructure will weigh on stock prices. Advanced Micro Devices, Micron and Applied Materials all posted double‑digit losses. Elon Musk’s public companies, SpaceX and Tesla, each slipped more than 9% after reports that Musk poured hundreds of millions into Republican campaigns in Texas and elsewhere. The election turned blue the states with the most aggressive AI data‑center plans, including Texas, Ohio and Georgia, where Democrat Jon Ossoff was re‑elected. Ballotpedia tracked 41 local measures in 10 states that would restrict data‑center construction; voters rejected all but one in Harwood, North Dakota. At the Wall Street Journal tech conference, Meta president Dina Powell McCormick said building new data centers will be harder after the vote. Qualcomm reported $650 million in data‑center revenue and called supply, not demand, the bottleneck. Intel posted a 78% jump in data‑center revenue, yet its stock fell on a cautious outlook. AMD said its data‑center sales more than doubled. Analysts such as Richard Clode of Janus Henderson said the market may see a “knee‑jerk reaction” and that answers to the slowdown are not yet clear.

Context

The selloff shows how closely AI‑infrastructure companies are linked to political outcomes and to broader issues like rising interest rates, memory shortages and large capital needs.