AI-linked shares recover some ground after steep sell-off

The S&P 500 fell 4.4% on Thursday, 5 November, closing at 7,353.73 after a sell-off in technology stocks. The broad US index lost 334.89 points, more than wiping out its 1.58% gain from the previous day.

The Nasdaq Composite, which includes many technology companies, fell 5.5% to 24,315. Chipmakers Nvidia and Advanced Micro Devices dropped 9.3% and 17.3%, respectively, according to the Associated Press.

Not all technology shares fell. Advertising technology company AppLovin rose 31% after reporting revenue and profit above analysts’ expectations.

Update

The Nasdaq Composite closed 1.1% higher at 24,579.42 on Friday 6 November, after falling 5.5% the previous day.

The broader US market was mixed. The S&P 500 rose 0.3%, having dropped 4.4% on Thursday, while the Dow Jones Industrial Average fell 0.5%. Despite Friday’s gains, the Nasdaq ended the week 3.4% lower and the S&P 500 was down 2.7%.

Nvidia shares rose 2.8% after a 9.3% fall on Thursday, according to the Associated Press. Fellow chipmaker AMD gained 11.04%, following a 17.26% drop, StockTitan reported. Both recovered only part of the previous day’s losses.

The Associated Press reported that the sell-off followed concerns that Democratic gains in the US midterm elections could slow the construction of AI data centres. Those concerns added to existing questions about borrowing costs and whether spending on AI would pay off.