The stock market’s huge post-election rally that President Donald Trump touted was largely erased by tech stocks a day later.
The Dow Jones Industrial Average jumped more than 1,500 points Wednesday, its best day since April 2025, CNBC reported, as Trump signaled he would accept the results and work with Democrats. Trump celebrated the gains on Truth Social at midday.
“Stock Market just hit another Record High — 91 Days in just a short period of time — Less than two years,” Trump posted. “Your 401(k)s are through the roof. Record Setting All!”
The rally was fueled in part by relief that Trump accepted Democrats’ sweeping victory, according to analysts who spoke to CNBC.
“President Trump’s acknowledgement of the Democrats’ victory in the midterms and his expressed openness to collaborating with the opposition have helped markets to rally on hopes that contestation of the results and more adverse polarization can be avoided,” said Thomas Hempell, senior economist at Generali Investments.
The good mood didn’t last. In midday trading Thursday, the tech-heavy Nasdaq Composite was down about 4 percent and had dipped into correction territory, sitting more than 10 percent under the record it set in October, CNBC reported. The S&P 500 was off 2.8 percent, and the Dow had given back 1,153 points, most of Wednesday’s gain.
Stocks tied to artificial intelligence took the hardest hit, as investors worried that Democratic wins in Congress and key governorships could slow the buildout of data centers, according to CNBC. Micron and AMD were each down as much as 16 percent, and Nvidia fell as much as 8 percent. Qualcomm dropped 11 percent after issuing a weaker than expected outlook, even though its earnings beat estimates.
The iShares Semiconductor ETF was down 11 percent at one point, which would mark its worst day since March 2020. AI cloud companies CoreWeave, Nebius and Iren dropped between 9 and 14 percent.
Investors are “stepping away until they get a better sense of the implications of the midterms around the AI capex cycle,” said Tim Holland, chief investment officer at Orion, according to CNBC.
“It’s about tone and tenor from the party that did really well, incredibly well, at the federal level and at the state level,” Holland said.