Stocks took a massive hit Thursday, amid concerns the AI boom could be losing steam, especially now that Democrats have won control of Congress and taken over in key states where data centers are under construction.
Wall Street reacted Thursday to the political shake-up in Washington, the stock market seeing its biggest decline in 19 months with the Dow diving more than 1,800 points, the tech-heavy Nasdaq losing an estimated $2.5 trillion in value in a single day, and the S&P 500, home to most people’s 401(k)s, dropping more than four percent.
President Trump blamed the Democrats’ victories in the Midterms for the sell-off, writing on Truth Social:
“The Stock Market suffered one of the Worst Days in History based on the results of the Election…Your 401(k)s have, therefore, dropped. Remember, it wasn’t Republicans; it was Dumocrats.”
But market analysts are urging investors not to panic.
Data centers are a key reason for the uncertainty in the technology markets. While needed to power the massive AI boom, they require enormous amounts of electricity, water, and investment.
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And across the country, communities are pushing back.
“We do not want a data center in this county, don’t you understand?” said one opponent.
That backlash was felt at the ballot box this week, with voters across the U.S. overwhelmingly approving local restrictions on data centers and Democrats winning control of Congress, including candidates who campaigned on reining in the industry.
“I do not work for data centers,” said Sen.-elect Sherrod Brown, D-Ohio.
Democratic governors also took control in Texas, Ohio and Georgia. Those three states amount to more than 40 percent of the new data centers that were planned in the U.S.
Now, investors worry that governors and new restrictions from Washington could slow planned construction after tech companies have already borrowed billions of dollars to build them.
So the big question is whether this is a temporary market correction, which many analysts believe, or the beginning of a much bigger reckoning for America’s AI boom.
Published by agreement with CBN News.
Caitlin Burke serves as National Security Correspondent and a general assignment reporter for CBN News. She has also hosted the CBN News original podcast, The Daily Rundown.
Some of Caitlin’s recent stories have focused on the national security threat posed by China, America’s military strength, and vulnerabilities in the U.S. power grid. She joined CBN News in July 2010, and over the course of her career, she has had the opportunity to cover stories both domestically and abroad.
Caitlin began her news career working as a production assistant in Richmond, Virginia, for the NBC affiliate WWBT. She is the oldest of seven children and is based in Washington, D.C., with her husband and daughter.
