Technology stocks plunged on Thursday as traders assessed the implication of a Democratic sweep in the U.S. midterm elections on artificial intelligence. | BLOOMBERG

The Democratic sweep in Congress devastated U.S. stocks on Thursday, with the tech-led Nasdaq notching its deepest one-day drop since “Liberation Day“ in April 2025 and wiping out trillions in market value on fears of more artificial intelligence scrutiny, particularly on data center construction.

The Nasdaq Composite fell 5.5% on investor fears that the Democratic Party’s sweeping midterm victory could stall AI infrastructure expansion and force a reckoning for smaller firms whose capacity to raise funds has already been limited by higher interest rates and tighter financial conditions.

It was the second straight day of selling in AI stocks and the fifth decline of more than 500 points in the Nasdaq Composite since mid-October, as the previously buoyant AI trade has come under increasing scrutiny in the last several weeks.

In a time of both…