AI stocks lost billions after the midterms. The data center vote is only one of three reasons on the table.

AI-linked stocks fell hard on Thursday, November 5, and the S&P 500 went down with them. By the AP’s midday update the index was off 3.2%, the Dow had dropped 1,079 points and the Nasdaq composite was down 4.9%. Every figure here is a midday number from the reports I cite, not a closing price.

Everyone agrees on the headline. The explanation is where the reports split.

How big was the drop?

The AP said Nvidia fell 6.3% after a 3.2% fall the day before, AMD fell 13.1% and CoreWeave fell 10%. NBC News reported that the S&P 500’s drop erased nearly $2.5 trillion from the index at one point in the morning, and that the Nasdaq composite entered a correction, meaning a fall of at least 10%. Bloomberg, which counted the Nasdaq 100 rather than the composite, had it down 5% in its wrap while NBC had it down more than 6% earlier in the morning. The two outlets measured at different times, so treat any single percentage as a snapshot.

One detail from the AP is easy to lose. A slight majority of S&P 500 stocks actually rose. AppLovin jumped 31.8% on results and the Coach and Kate Spade owner gained 8.3%. Nvidia is so large that its fall alone outweighed those gains.

What are the three explanations?

Cause	Who says it	What they cite
Data center limits after the elections	AP, CNBC, Bloomberg	Democratic wins in Congress and in governor races in Texas and Ohio
Weak chip earnings	NBC News, Bloomberg	Qualcomm and Arm results released on Wednesday night; Qualcomm fell 9% and Arm about 15% in early trading
Borrowing costs and spending doubts	AP, NBC News	Expensive debt for data center builders and doubts that AI will pay back the spending

NBC News put the earnings reports first, calling them the trigger. The AP and Bloomberg put the election first. My read: no source I found can weigh the three against each other, and I doubt a clean answer exists yet.

Did voters really turn on data centers?

On the ballot, yes. CNBC, citing Ballotpedia, counted 41 local data center measures in 10 states on Tuesday. Voters sided against data centers in all of them except one, in Harwood, North Dakota. In a CNBC voter poll, 56% said data centers were at least a major factor in their vote.

The higher-profile results were governors. CNBC reported that Gina Hinojosa unseated Texas Governor Greg Abbott after blaming him for the data center buildout, and that Amy Acton won in Ohio while backing a “conditional moratorium.” Ohio is also home to the PORTS-Pike campus that OpenAI announced in August.

What can actually change, and when?

Not much on the day. The AP itself noted that stock prices tend to follow corporate profits and interest rates over the long term, much more than who controls what in Washington. Bloomberg quoted JPMorgan Asset Management’s Jordan Jackson and Stephanie Aliaga saying statewide moratoriums have struggled to become law, and that they expect the boom to stay on track but become “costlier, slower and more consolidated.”

My read: the selling looks like investors pricing in a risk they can’t size yet. Bloomberg quoted JonesTrading’s Michael O’Rourke saying nobody knows where earnings estimates will reset. That’s a statement about uncertainty, not about a policy that exists. A governor’s campaign promise isn’t a permit freeze, and a permit freeze in one state isn’t a national limit.

I also think the earnings explanation gets less attention than it should. Qualcomm and Arm were weak on their own numbers, and chip stocks were already sliding in October, according to CNBC, on rising interest rates and overspending worries. The election gave a nervous market a story to attach to a drop that had other causes.

Companies are already responding to the politics. On the same day, OpenAI published pledges to pay for the electricity its own data centers use, which I covered in OpenAI pledges to pay its own power bills. For an earlier case of investors reacting to the cost of funding this buildout, see CoreWeave’s bonds now yield nearly 15%.

Note on sources: all market figures are midday numbers from the AP, NBC News and Bloomberg reports below, and they were still moving when those reports were written. Bloomberg and NBC measured the Nasdaq 100 at different times of day, which explains the gap I quote. Ballot results are CNBC's, citing Ballotpedia, with Wednesday as the cutoff for results available. I haven't checked any of the stock moves against exchange data.

Sources

1. AP: A wipeout for AI stocks sends Wall Street tumbling, and the S&P 500 drops more than 3%
2. CNBC: Voters rebuff data centers in every ballot measure except one during the 2026 midterms
3. NBC News: Tech stocks plunge on worries about AI and Democrats’ midterm landslide
4. Bloomberg: Nasdaq 100 Sinks 5% as Chipmaker Selloff Deepens