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U.S. stocks reversed Wednesday’s post-election rally on Thursday, with chip and AI-related shares leading a broad sell-off. The Dow fell 2.2%, the S&P 500 lost 3.3% and the Nasdaq dropped 5%; the semiconductor index fell 11%. Oil rose amid uncertainty over a possible U.S.-Iran deal, while the day’s market moves and election-related policy implications remained in focus.
U.S. stocks fell sharply Thursday, reversing the prior day’s post-election rally as investors sold AI and semiconductor shares. The Dow Jones Industrial Average dropped 2.2%, the S&P 500 fell 3.3% and the Nasdaq Composite slid 5%, according to Yahoo Finance’s market report updated at 5:37 p.m. GMT+1.
The sell-off was particularly steep in chip stocks. The PHLX Semiconductor Index fell 11%, while Nvidia, Micron and other semiconductor companies declined. Yahoo Finance reported that Nvidia shares fell, Micron shares sank, and the earlier live coverage put declines for Nvidia, Micron and AMD at more than 6%, 12% and 13%, respectively. Those intraday figures describe a point in the session and should not be confused with the final closing returns.
The reversal followed an uneven start to Thursday. In early trading, the Dow was up 0.6%, while the S&P 500 edged down 0.3% and the Nasdaq fell 1%. As selling intensified, a later update said the Nasdaq was down roughly 4%, the S&P 500 2.3% and the Dow more than 700 points, or 1.4%. The day’s final report recorded larger declines. The Nasdaq was on track to close in correction territory, but the report did not confirm that it had done so.
Market moves were not uniform. AppLovin rose 23% in premarket trading after reporting third-quarter revenue and earnings per share above analyst estimates and giving a stronger-than-expected fourth-quarter revenue forecast. Its shares’ gain contrasted with the broader technology sell-off. Oil also rose: Brent crude traded around $97 a barrel and U.S. benchmark West Texas Intermediate around $90, amid uncertainty over whether President Donald Trump would pursue a deal with Iran to end the Middle East war.
The Sell-Off Hits AI and Chips
The scale of Thursday’s drop matters because technology and semiconductor shares had helped drive market gains and were central to the previous day’s rally. Their reversal pulled the Nasdaq down more than the Dow and put the index near a correction, a threshold the source said it was on track to reach but did not confirm as a closing result.
The move also coincided with a sharp increase in expected market volatility. Yahoo Finance reported that the CBOE Volatility Index rose more than 65%, reaching as high as 27.45. Futurum Equities chief market strategist Shay Boloor described it as the gauge’s biggest one-day jump in more than two years. That rise reflected heightened investor concern during the session; it does not, by itself, establish how markets will perform next.
Investors were also weighing what the election outcome could mean for economic policy and industries including AI and cryptocurrency. The broad reversal shows that Wednesday’s relief rally did not settle those questions, while rising oil added another source of market uncertainty.
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Election Rally Meets Policy Questions
Democrats swept both chambers of Congress in Tuesday’s midterm elections, according to the source report. Stocks rallied Wednesday as investors reacted to the election results and the removal of some uncertainty. Thursday’s trading gave back those gains as investors reassessed possible winners and losers from the change in congressional control.
Yahoo Finance’s live coverage linked pressure on chip and data-center stocks to investor questions about potential AI infrastructure spending and regulation. It also reported that Qualcomm fell after quarterly results. The market report did not establish that election-related policy concerns alone caused the sell-off; chip and technology shares were falling amid broader AI-related jitters.
Separate developments added to the day’s uncertainty. A Challenger, Gray & Christmas report said planned layoffs in October fell to their lowest level since 2023, as companies focused on retaining existing employees. Investors were looking ahead to Friday’s employment report. The day’s scheduled earnings included reports from Duke Energy, Airbnb and Lumentum, among others.
Closing Levels and Policy Remain Open
The report described the Nasdaq as on track to close in correction territory, but did not confirm its final closing level or whether it ultimately crossed that threshold. The reported index declines and individual stock moves also varied across updates during the trading day, so the later figures should not be treated as a complete account of every closing price.
It remains unclear how much of the reversal reflected election-related policy reassessment versus concerns about AI valuations, chip stocks or other market factors. The report did not identify a single cause for the sell-off. Nor did it confirm whether the Trump administration would pursue a deal with Iran, what any deal might involve, or how oil prices would respond.
The source also reported a $6.3 billion Binance hack as a factor cited in coverage of cryptocurrency weakness, but did not provide further detail on the incident in the material supplied. Bitcoin briefly fell below $76,000 before recovering above that level, according to the live report. Any subsequent price movement and the prospects for the Clarity Act remained unsettled.
Friday Jobs Data in Focus
Investors were looking ahead to Friday’s U.S. employment report, following the October layoff-plans data from Challenger, Gray & Christmas. The report could add information about labor-market conditions, though the source did not state what result markets expect or how investors would respond.
Markets will also continue to react to company earnings and developments in Washington. The source listed results from Duke Energy, Airbnb and Lumentum among Thursday’s scheduled reports, while election-related questions around AI investment, regulation and cryptocurrency policy remain in view. Further updates would be needed to confirm closing index levels and whether the Nasdaq entered a correction.
Key Questions
What happened to U.S. stocks on Thursday?
U.S. stocks fell sharply as AI and semiconductor shares sold off, reversing Wednesday’s post-election rally. Yahoo Finance reported drops of 2.2% for the Dow, 3.3% for the S&P 500 and 5% for the Nasdaq in its later update.
Which stocks or sectors led the decline?
Semiconductor stocks were among the hardest hit. The PHLX Semiconductor Index fell 11%, and Nvidia, Micron and other chip shares declined. The report also described weakness in technology and data-center stocks.
Did the Nasdaq close in correction territory?
The report said the Nasdaq was on track to close in correction territory. It did not confirm the final closing level or say whether the index ultimately met that threshold.
Why did oil prices rise?
The report attributed the rise to uncertainty over whether President Trump would pursue a deal with Iran to end the Middle East war. Brent traded around $97 a barrel and U.S. WTI around $90 in the reported update.
What market event was investors watching next?
Investors were looking ahead to Friday’s U.S. employment report. The source also noted that companies including Duke Energy, Airbnb and Lumentum were due to report earnings.
Source: finance.yahoo.com
