US President Donald Trump has blamed the Democratic Party’s sweeping victories in the November 3, 2026, US midterm elections for a sharp fall in the country’s stock market, after Wall Street suffered one of its worst trading sessions in more than a year on Thursday, November 5.
Trump made the claim in a post on his Truth Social platform following the market sell-off, accusing Democrats of contributing to the decline through their electoral gains.
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“The Stock Market crashed today because the Dumocrats had a big Tuesday. So sad to see, you only have yourselves to blame!” Trump wrote.
However, market analysts attributed the downturn largely to investor concerns that the Democrats’ growing political influence could lead to tighter regulations on artificial intelligence infrastructure, particularly the construction of large data centres across the United States.
The technology-heavy Nasdaq Composite suffered a 5.5 per cent decline, shedding 1,421.52 points to close at 24,315.
The drop marked its worst single-day percentage performance since April 2025.
The broader S&P 500 also recorded a significant decline, falling 4.4 per cent, or 334.89 points, to 7,353.73.
Meanwhile, the Dow Jones Industrial Average lost 1,833.06 points, representing a 3.4 per cent fall to close at 51,523.06.
According to the Associated Press, the sell-off erased the previous day’s gains, which had marked the S&P 500’s strongest performance in three months.
All four major US stock indexes ended Thursday’s session lower.
The sharp decline reflected growing uncertainty over the future of the artificial intelligence industry, which has become a major driver of investment and stock market growth in recent years.
Investors are particularly concerned that Democratic victories could strengthen efforts to restrict or delay data centre developments, which require substantial electricity, water and land resources.
Reuters reported that voters in 10 states supported restrictions on data centre developments or rejected proposals for new facilities during the midterm elections.
Of 41 ballot measures tracked by Redbud Consulting, 40 sought to restrict the establishment of data centres.
The election results have therefore raised expectations of stronger political and regulatory scrutiny of the industry, with investors reassessing the prospects of companies that depend on continued expansion of AI infrastructure.
Michael O’Rourke, chief market strategist at JonesTrading, identified the implications of the Democratic victories for data centre development as a major concern for investors.
“The slowdown of the data center buildout is the real key theme that’s going to stick,” O’Rourke said, according to Reuters.
The pressure extended beyond technology companies, with semiconductor manufacturers among the biggest casualties.
Nvidia shares fell by 9.3 per cent, while the Philadelphia Semiconductor Index recorded a decline of approximately 12 per cent, its second-largest fall on record.
Other major technology companies, including Advanced Micro Devices and Micron Technology, also suffered substantial losses, reflecting concerns that slower data centre construction could weaken demand for chips and other infrastructure required to power AI systems.
The political implications of the midterm elections have added another dimension to the market uncertainty.
Democrats recorded significant gains in Congress and governorships, strengthening their capacity to influence legislation and policies affecting the technology sector.
Reuters reported that the party flipped seven Senate seats, gained at least 39 seats in the House of Representatives and secured five governorships.
The results also highlighted growing public resistance to large-scale data centre projects, with concerns surrounding electricity consumption, water resources and the impact of such developments on local communities.
Despite Thursday’s dramatic losses, the major US stock indexes remained in positive territory for the year. The S&P 500 was still up 7.4 per cent, the Dow had gained 7.2 per cent, while the Nasdaq remained 4.6 per cent higher.
The market reaction has underscored the growing influence of political decisions on the technology investment landscape, particularly as the United States continues to expand its artificial intelligence capabilities.
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While Trump has placed responsibility for the market decline on his political opponents, investors’ concerns suggest that the future direction of AI infrastructure development and the possibility of tighter regulation will remain important issues for Wall Street.
