US tech stocks recover after selloff spooks investors over AI spending
Midterms didn’t appear to have huge impact, though predicted wins for Democrats could mean more regulation US tech stocks made a recovery on Tuesday afternoon after a selloff spooked investors over AI spending. Tuesday’s midterm elections didn’t appear to have a huge impact on Wall Street, though investors are predicting Democrats get at least a majority in the House and potentially gain seats in…
US tech stocks staged a rebound on Tuesday, following a market-wide sell-off that left investors concerned about increased spending on artificial intelligence (AI) technology. The midterm elections, which took place on Tuesday, appeared to have little effect on Wall Street, although there are predictions that Democrats may secure a majority in the House and gain seats in the Senate. This could potentially lead to more regulation of AI.
The S&P 500 index was up 0.37% at market close, while the tech-focused Nasdaq increased by 0.83%. However, the Dow Jones Industrial Average fell by 0.38%, following a sharp drop in Apple's share price. This decline was due to a margin forecast that was worse than expected, largely attributed to the higher cost of memory chips.
Nvidia experienced a 2.3% gain, rebounding after falling for four consecutive days. Other chip manufacturers, such as Advanced Micro Devices, Broadcom, and Micron Technology, also showed gains on Tuesday. The period of concern for AI and tech stocks ended on Tuesday, with the Nasdaq experiencing its largest monthly decline since March 2025 during October.
The recent drop in oil prices, possibly due to new negotiations with Iran and Russia, also helped ease investors' nerves. Brent crude, the global oil benchmark, fell to $103 a barrel on Tuesday, down from $117 at the end of October.
Despite concerns about higher living costs, many Americans expressed that their vote on Tuesday would be influenced by these issues. However, Wall Street continued to benefit from investments in AI technology, particularly in chips and infrastructure. Throughout 2024, the S&P 500 has risen by 10%, the Nasdaq by 9%, and the Dow by 7%.
According to analysis from CNBC, spanning from 1980 to 2024, the market generally experiences a rise in performance after an election. Wall Street tends to be nervous before an election when results are uncertain, but once the results are finalized, it tends to recover.
Written by urgent.news from Guardian Technology's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
