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Nvidia, Micron, and other AI stocks take a dive after elections
AI-linked technology stocks fell after the US midterm elections, as investors reassessed the prospects for large-scale data centre investment. The decline reflects growing uncertainty about whether companies will spend as much on AI infrastructure as markets have expected.
By 2.30 pm EST, the S&P 500 was down about 3.9% after rising the previous day. Nvidia shares had fallen below their level at the start of the year, while memory and storage company Micron was down about 15%. Democratic victories and votes across the country to curb data centre expansion added to investor concerns; Wall Street has forecast $1.2 trillion in AI-related capital spending next year.
In short
- AI-linked shares fell after the US midterms.
- Micron was down about 15%.
- Investors questioned a forecast $1.2 trillion in AI spending.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Investors may be right to question whether the expected $1.2 trillion in AI-related spending will materialise. If companies scale back data centre plans amid political resistance and uncertainty over returns, today’s high valuations could prove unsustainable, making a reassessment prudent.
The case against
The sell-off may overstate the effect of election results and local opposition on a long-term investment cycle. Companies could continue building AI capacity because they expect strong demand and competitive gains, so a sharp fall in shares may reflect short-term uncertainty rather than weaker underlying prospects.