The midterms revolutionize the map of winners and losers on the AI Stock Exchange

The midterms have revolutionized the map of winners and losers on the AI stock market, according to updated data as of today. Goldman Sachs fears a moratorium for 45% of US data center projects, impacting major players like Amazon, Alphabet, Nvidia, CoreWeave, and ACS. The market's reaction to the clear Democratic victory in midterm elections left many analysts baffled, as the S&P 500 rose by 1.5% during the session.

Investors had already accounted for the change in control of Congress and President Trump's contented reaction, preventing a constitutional crisis. Analysts noted the rebirth of stocks and riskier currencies, attributing it to the combination of a Democratic majority in Congress and Trump's willingness to work with opposition. However, beneath the indices, investors showed significant discrimination among different stocks, with tech companies making up around 40% of the S&P 500's capitalization.

While some major companies experienced gains of over 6%, others faced declines near 10%. Amazon, Microsoft, and Apple rose by 6% to 7%, while Alphabet and Meta gained between 3% and 4%; Oracle increased by less than 1%, while Nvidia fell by nearly 2% and Intel by a similar margin. Tesla and SpaceX saw declines of over 2%, and CoreWeave rebounded by 9%.

The opposite reactions stem from uncertainty about the future development of data centers supporting artificial intelligence (AI). According to Goldman Sachs analysts, Democratic victories at the state and local levels could lead to significant regulatory implications for AI and data centers, potentially triggering a short-term moratorium on new installations in areas like Texas, affecting about 45% of planned capacity expansion in the US.

This moratorium could alleviate the burden of the heavy investments these companies have made, but at the same time, providers of "hyper-scalers" like Nvidia and Intel, as well as cloud storage provider CoreWeave, saw a decline in their stock prices due to a potential reduction in demand for their products and services. In Spain's Ibex, ACS suffered due to similar reasons, with many contracts for building data centers in the US.

Tesla and SpaceX's vulnerability to political reprisals is heightened by their founder Elon Musk's close relationship with Trump, according to investors. In Texas, where these companies are headquartered, the state could impose taxes, and the potential merger of Tesla and SpaceX might face increased regulatory scrutiny in Washington, similar to Oracle's lackluster performance due to its founder Larry Ellison's close ties to Trump.