Investors withdrew $2.5 trillion, equivalent to approximately R$ 13.7 trillion in market value, from the Nasdaq 100. This strong wave of selling was driven by technology stocks and reflects apprehension that there will be greater political resistance to the expansion of data centers intended for artificial intelligence.
The decline occurred shortly after the decisive victory of the Democratic Party in the US midterm elections. There is a fear among investors that the new political landscape could hinder the growth of AI infrastructure and worsen financing conditions for smaller companies in this sector.
The Nasdaq Composite registered a drop of 5.5%, while the Nasdaq 100 retreated by 6.4%. With this accumulated loss of almost 12% since the peak recorded on October 6th, the index entered correction territory, which is defined as a minimum drop of 10% from its recent high point.
The capture of several state governments by Democrats intensified concerns regarding local opposition to the construction of new facilities. Such projects are facing scrutiny concerning energy and water usage, in addition to putting pressure on existing supply systems.
According to estimates from UBS analysts, it is estimated that about 30% of the additional data center capacity planned for the United States in 2028 could be threatened due to possible construction stoppages. This scenario also generates uncertainty regarding the financial return on billions of dollars invested in artificial intelligence.
Michael O’Rourke, Chief Market Strategist at JonesTrading, identified the slowdown in construction as one of the central factors behind the reaction observed by investors.
The retraction affected both chip manufacturers and companies that provide computing infrastructure for AI applications. The Philadelphia Semiconductor Index plummeted 12%, reaching its lowest level in over six months.
Neocloud companies, which specialize in cloud computing infrastructure, are also facing concerns about the financing of their activities. CoreWeave's five-year default protection contracts reached a record of 1,267.9 basis points, and for Intel, the indicator reached 149.7 basis points, also a record.
Since the Nasdaq's peak on October 6th, CoreWeave and Nebius shares have lost at least half their value. For Ted Parkhill, founder and CEO of Incline Investment Management, it was stated that 'the market is moving from the promise of AI to the price of AI.'
The devaluation also reached companies that had initially resisted the selling wave. Amazon and Alphabet each registered drops of 2.2%, while Microsoft retreated by 3.6%.
The negative movement extended to energy companies and equipment suppliers. GE Vernova suffered a loss of 7.4%, and Constellation Energy fell 2.5%.
The Nasdaq 100 retreated by 6.4%, resulting in the elimination of $2.5 trillion in market value. Simultaneously, the VIX, which measures expected market volatility, reached its highest level since December 2024.
In Asian markets, Japan's Nikkei and South Korea's Kospi also showed declines after having accumulated gains of over 20% during the year.
The current instability has raised doubts among analysts about the timeline for Anthropic's Initial Public Offering (IPO), scheduled for the autumn of the Northern Hemisphere. Additionally, according to Bloomberg News, Microsoft is intensifying oversight of certain data center projects linked to Nebius, IREN, and Nscale.
