Wealthfront says AI spending concerns drive post-midterm market sell-off
SPY•Wealthfront attributed the post-midterm sell-off to concerns about voter opposition to data centers and AI spending. On Thursday, the S&P 500 fell 4.36%, the Nasdaq dropped 5.52% and the Dow declined 3.44%; the Magnificent Seven lost $1 trillion in combined market value.
1. Market declines
Wealthfront attributed the post-midterm sell-off to voter opposition to data centers, which it said fueled concerns about AI spending and broader technology-sector growth. The S&P 500 fell 4.36% Thursday, the Nasdaq Composite dropped 5.52% and the Dow Jones Industrial Average declined 3.44%, erasing initial post-midterm gains.
2. Technology stocks fall
The Nasdaq entered correction territory, more than 10% below its record from the previous month. The Magnificent Seven lost $1 trillion in combined market value Thursday; they represent roughly one-third of the S&P 500’s weight.
3. Wealthfront’s guidance
The analysis urged investors to stay invested rather than try to time market bottoms, and emphasized diversification, tax-loss harvesting and low fees.
