Investors have pulled back sharply from major technology stocks following growing uncertainty over the future of artificial intelligence investment, as political resistance to the expansion of data centres in the United States raises questions about the sector’s growth prospects.
The market downturn has affected technology companies across several continents, with semiconductor manufacturers and firms supplying equipment for AI infrastructure recording substantial losses.
According to BBC News, the Nasdaq Composite Index closed more than 5.5 per cent lower on Thursday, representing an estimated $2.5 trillion decline in market value. Seven leading technology companies, including Apple, Nvidia and Tesla, also suffered combined losses estimated at about $1 trillion.
The pressure spread to Asian markets on Friday, where Japan’s Nikkei 225 dropped 6.3 per cent, while South Korean technology stocks also experienced significant declines. European equities were not spared, as Britain’s FTSE 100 and Germany’s Dax fell by about 1.5 per cent in early trading.
The uncertainty follows the Democrats’ victories in the US midterm elections, with several successful candidates having made opposition to the rapid expansion of AI infrastructure part of their campaigns. Texas governor-elect Gina Hinojosa, for instance, advocated a halt to new data centre construction in the state.
The prospect of tighter controls has unsettled investors because data centres provide the computing capacity required to operate artificial intelligence systems. However, their growing demand for electricity, land and water has generated opposition in communities where new facilities are being developed.
Tudor Brown, co-founder of British semiconductor company Arm Holdings, told BBC Radio 4 that concerns about the scale of AI expansion had emerged months before the elections. Although he acknowledged the market reaction, he maintained that the industry’s financial prospects remained substantial.
Meanwhile, US President Donald Trump attributed the stock market losses to the Democrats’ election performance, while executives in the technology industry have acknowledged the need to improve public engagement over the construction of AI facilities.
