Nasdaq posts biggest daily drop in 19 months on fears of AI regulations
SPY•The Nasdaq fell 5.52% on Thursday, its biggest daily drop in 19 months, confirming a correction as investors worried that tighter AI regulations could slow data center construction. The S&P 500 fell 4.36% and the Dow dropped 3.44%.
1. AI regulation fears weigh
The Nasdaq Composite fell 5.52% on Thursday, its deepest one-day decline in 19 months, and confirmed a technical correction after closing more than 10% below its October 6 record. Concerns that Democratic election victories could bring tighter regulation and slow AI infrastructure development weighed on chipmakers and data center companies.
2. Broad market declines
Nvidia fell more than 9%, and the Philadelphia Semiconductor index plunged more than 12%. The selloff erased $3 trillion in market value from S&P 500 companies. The S&P 500 ended down 4.36% at 7,353.73, while the Dow fell 3.44% to 51,523.06.
3. Other stocks and outlook
Meta fell 4%, while Amazon and Alphabet each dropped 2.2%. Qualcomm slid 9.5% after missing Wall Street estimates for fourth-quarter smartphone chip sales. Trading volume reached 26.9 billion shares, compared with a 20-session average of 17.7 billion; investors were also focused on Friday’s US October payrolls report.
