US stocks had their worst day since April 2025's tariff shock: the S&P 500 fell 4.4%, the Nasdaq Composite dropped 5.5% into correction territory and the Dow lost 1,833 points (3.4%), erasing Wednesday's post-midterm rally. Chip stocks led the rout, with a semiconductor ETF down about 11%, on fears that a Democratic Congress will tighten AI regulation and make data-center buildouts harder. All 11 S&P 500 sectors closed lower. Asia's session earlier was split, with South Korea down 5.3% and Hong Kong up 3.7%, and early Friday trading there has turned sharply worse. President Trump blamed the election result on Truth Social, while analysts pointed to the unwinding of crowded AI trades that had been under way for over a month.
- The S&P 500 fell 334.89 points (4.36%) to 7,353.73, the Nasdaq Composite lost 1,421.52 (5.52%) to 24,315.00, the Dow dropped 1,833.06 points (3.44%) to 51,523.06 and the Russell 2000 fell 4.4% to 2,729.89. The Nasdaq-100 sank 6.36% to 26,629.81. The Nasdaq is now about 11.9% below its record and traded below its 200-day moving average for the first time since April.
- For the week, the S&P 500 is down 3%, the Dow 0.5%, the Nasdaq 4.4% and the Russell 2000 2.9%. For the year, the S&P 500 is up 7.4%, the Dow 7.2%, the Nasdaq 4.6% and the Russell 2000 10%. Breadth was ugly: midday there were 419 S&P 500 losers against 84 gainers, and the Magnificent Seven were down roughly $900 billion in aggregate heading into the final hour.
- Chips took the worst of it. The semiconductor index fell about 12% and Nvidia, Micron, AMD, Broadcom and Qualcomm all dropped, with Oracle also lower. The day began calmly: hyperscalers and Apple were extending Wednesday's gains, Amazon was up 2% premarket after jumping 8% the day before, and the Dow was green early, before the chip sell-off spread to everything. A Nomura strategist said the market was "shooting the generals," describing the unwind of this year's popular thematic stocks as "wildly acute."
- Volatility spiked: the VIX touched 28.09 intraday, its highest since March 31. Brent crude rose about 4% after Wednesday's drop. After the close, stock futures fell further. Friday's October payrolls report is the next catalyst for Fed rate-hike odds, now made harder to read by the AI sell-off.
- Asia's Thursday session split along AI exposure. South Korea's KOSPI fell 5.28% to 5,383.80, Taiwan's Taiex lost about 3.3% and Japan's Nikkei 225 slipped 1.79% to 61,077.90. Hong Kong's Hang Seng jumped 3.67% to 24,796.98 (its biggest gain since May 2025), led by a roughly 5.5% surge in the Hang Seng Tech index. China's CSI 300 rose 0.29% to 4,113.41, and Australia's ASX 200 gained about 2.6%. The dollar index was near 101.3, close to one-month lows, and the yen near 157.9 per dollar.
- Friday's Asian session is opening under heavy pressure, with Bloomberg reporting the KOSPI down 8.8% early, triggering a circuit breaker, as Samsung and SK Hynix each fell more than 9%. The Nikkei fell about 5.1% and the MSCI Asia Pacific index 2.3%, and CNBC reports Japan's Nikkei has entered a bear market. These are early-session moves, so check the closes.
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