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TL;DR
The Nasdaq Composite dropped 5.52% on Nov. 5, while the Nasdaq-100 fell 6.36%; Reuters put the Nasdaq-100’s lost market value at about $2.5 trillion. The selloff reflected investor concerns that election results could lead to greater scrutiny and higher costs for AI data centers, but no new federal rules have been enacted and many proposed changes remain uncertain.
The Nasdaq Composite fell 5.52% on Nov. 5, and the Nasdaq-100 dropped 6.36%, as investors weighed whether U.S. election results could bring tighter oversight and higher costs for AI data center projects. Reuters estimated that the Nasdaq-100 decline erased about $2.5 trillion in market value; the figure applies to that index’s 100 large non-financial companies, not all Nasdaq-listed stocks.
Nasdaq’s published closing data put the Composite at 24,315.00, down 1,421.51 points, and the Nasdaq-100 at 26,629.81, down 1,807.36 points. The Composite’s loss was its steepest since April 4, 2025, during the tariff-related market shock, according to the source’s comparison of index data. It closed 11.9% below its Oct. 6 record, placing it in correction territory, defined as a decline of at least 10% from a recent peak.
Technology and infrastructure-related shares took particularly heavy losses. The PHLX Semiconductor index fell 12.25%. Reuters reported that Nvidia shares fell 9% and AMD fell 17%, while several data center operators lost more than 14%. Amazon and Alphabet each fell 2.2%, and Microsoft slid 3.6%, according to Reuters. The market’s concern was not a reported collapse in AI demand, but the possibility that building new facilities could become slower or more expensive.
The political backdrop was the midterm result, which the source says put Democrats in control of both chambers of Congress and flipped several governorships. Reuters and The National reported that investors were considering possible effects including congressional hearings, changes to tax incentives, and greater scrutiny of energy and water use. These are investor concerns and forecasts, not enacted policy changes.
Infographic 01 · The day in numbers
The Nasdaq's worst day in 19 months
Chips and data center builders led the fall. The dollar figure in the headlines belongs to the Nasdaq-100, the 100 largest non-financial companies on the exchange.
Nasdaq Composite on Thursday, 5 November 2026: down 1,421.51 points to 24,315.00. The biggest one-day fall since 4 April 2025, 19 months earlier.
The five worst Composite days since March 2025
Daily change, closing values
Sources: Nasdaq Global Indexes (COMP, NDX, SOX closing data, retrieved 6 Nov 2026) · Reuters, 5 Nov 2026 (via The Straits Times). History checked back to 25 Mar 2025. Market value is Reuters’ calculation. Not investment advice.
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How Data Center Costs Could Change
The selloff shows how expectations about permits, power access and tax incentives can affect companies tied to the AI build-out, even before lawmakers or regulators make new decisions. Data centers require large amounts of electricity, land and water. If project approvals take longer or developers must pay a greater share of infrastructure costs, planned construction could face delays or become more expensive.
That could matter beyond technology stocks. Utilities, local communities and businesses counting on new computing capacity may also be affected by changes to where facilities are built and how their energy costs are allocated. But a one-day market move does not establish that projects will be cancelled, nor does it prove that new rules will follow. The scale of the share-price reaction reflects investor expectations, which can change as policy plans become clearer.
A UBS estimate cited in the source says about 30% of planned 2028 capacity additions could be at risk. That is an estimate, not a confirmed reduction or government decision. Readers should treat it as a forecast about potential exposure rather than a measure of projects already halted.
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Election Results and Project Approvals
The market reaction followed a mixed sequence. On Nov. 4, the Nasdaq Composite rose 1.44%, even as Reuters reported that some data center operators and power companies fell. Amazon and Microsoft were each up about 6% during that session. Reuters described one market interpretation: existing facilities could become more valuable if fewer new ones are built. The following day, that view gave way to a broader selloff affecting technology companies as well as infrastructure-related stocks.
The National reported that Democrats flipped five governorships: Texas, Georgia, Ohio, Iowa and Nevada. Its analysis of Cleanview project data said those states account for 37% of planned U.S. data center capacity, with Texas representing 22.8%. Those figures describe planned capacity, not completed construction. The National also reported campaign promises by incoming governors in Texas, Georgia and Ohio to pause or restrict some large projects; the details and legal authority for any such steps remain to be seen.
Governors can influence state-level permitting and incentives and appoint utility regulators, while local governments may have a role in land-use decisions. The source also reports that unofficial results from local ballots in ten states showed 46 of 47 measures opposing data center development. Those measures included proposed bans, size limits or pauses; their status and effect depend on the final results and local processes.
““deepest one-day drop since ‘Liberation Day’ in April 2025””
— Reuters, describing the Nov. 5 market session
Policy Changes Are Not Yet Settled
No new federal law restricting data center construction had passed at the time described in the source. The source says President Donald Trump retains veto power and that some analysts expect political gridlock rather than sweeping changes. The balance of power in Congress alone does not establish that proposed oversight or restrictions will become law.
It is also unclear which campaign commitments will become specific policies, how quickly any state or local measures could take effect, and whether they would apply to projects already planned or under construction. The reported 30% capacity-at-risk estimate is a UBS forecast, while the market-value loss and index declines are reported figures for the Nov. 5 session. They should not be read as evidence that 30% of projects have been stopped.
Permits and State Plans Ahead
Investors and data center developers will be watching for concrete steps from the incoming governors, state utility regulators and the new Congress. Relevant developments include proposed legislation, public hearings, utility decisions on grid connections and electricity costs, and any formal state or local pauses on projects.
Further market sessions may show whether the Nov. 5 decline reflects a lasting reassessment or a short-term reaction to uncertainty. Until governments publish specific rules and decisions, the effects on construction schedules, planned capacity and company spending remain unresolved.
Key Questions
What does the $2.5 trillion figure refer to?
Reuters estimated that about $2.5 trillion in market value was erased as the Nasdaq-100 fell 6.36% on Nov. 5. The estimate refers to the index’s 100 large non-financial companies, not every stock listed on Nasdaq.
Why did AI data centers factor into the selloff?
Investors worried that election results could lead to more oversight, fewer tax incentives, project pauses or higher costs for electricity and water. These were concerns about possible future policy, not confirmed changes to data center rules.
Have new restrictions on data centers been enacted?
The source says no new federal law had passed. Campaign pledges and reported local ballot results may lead to later proposals or decisions, but their final scope and effect were not yet clear.
Does the 30% estimate mean projects have been cancelled?
No. The source attributes the figure to a UBS estimate that about 30% of planned 2028 capacity additions could be at risk. It is a forecast, not a confirmed count of cancelled or halted projects.
Source: ThorstenMeyerAI.com
