Global Tech Stocks Slide as U.S. Midterm Results Heighten AI Concerns

Global Tech Sell‑off Hits Asia and Europe

On Friday, global markets experienced a steep decline in technology shares, a reaction that began on Wall Street and spread to Asia and Europe. The Nasdaq 100 fell 6.3% on Thursday, wiping out about $2.3 billion in market value, while the S&P 500 dropped 4.4%, erasing $2.8 trillion and marking its worst day in 18 months.

The rout extended to Asian markets. Japan’s Nikkei 225 fell as much as 6%, entering bear‑market territory and recording its worst week since 2020. In South Korea, the Kospi index plunged more than 8%, prompting a temporary trading halt; AI data‑center memory suppliers Samsung and SK Hynix fell over 10% before recovering partially. Taiwan’s TAIEX index dropped 9%, reflecting the impact on key AI suppliers such as TSMC.

European indices also fell. London’s FTSE 100 slipped nearly 2%, while France’s CAC 40 and Germany’s DAX recorded similar losses.

Background

The sell‑off followed the U.S. midterm elections, in which candidates opposed to further AI development won a significant number of seats. Analysts say the results intensified fears about the sustainability of the AI boom, as the new legislative direction could lead to stricter regulation or reduced investment in AI infrastructure.

The Nasdaq 100 and S&P 500 had previously suffered a sharp decline on Thursday, with the former losing 6.3% and the latter 4.4%. The losses were described as the worst day in 18 months, a period that had already seen market turbulence when former President Donald Trump’s tariffs affected global trade.

Why it matters

The decline in tech shares has immediate implications for investors holding exposure to AI‑related companies. The sharp drop in indices such as the Nikkei, Kospi, and TAIEX highlights the vulnerability of markets heavily reliant on AI supply chains. The fall in major U.S. indices also signals a broader risk of a slowdown in technology investment, potentially affecting companies that depend on AI for growth.

The reaction underscores the link between political outcomes and market sentiment, particularly in sectors perceived as sensitive to regulatory change.

What happens next

The sources do not provide specific next steps or dates for further market actions. However, the pattern of a sustained sell‑off suggests that investors will closely monitor upcoming legislative developments and corporate earnings for signals of how AI policy will evolve.