AI, data-center stocks slump as Democratic sweep clouds expansion plans
Data-center and AI-related stocks fell sharply as investors worried that Democratic control could bring greater scrutiny to the industry and delay infrastructure expansion. Analysts estimated that about 30% of expected U.S. data-center capacity additions in 2028 could face risks from potential construction pauses.
Data-center and AI infrastructure stocks declined as investors assessed the potential impact of a Democratic midterm victory on the pace of industry expansion. CoreWeave, Nebius, Applied Digital, Cipher Digital and IREN posted steep losses, while Nvidia and other semiconductor companies also fell.
Investors are concerned that increased government scrutiny and growing public opposition to new data centers could delay billions of dollars in construction. UBS analysts estimated that roughly 30% of anticipated U.S. data-center capacity additions in 2028 could be affected by potential construction pauses, adding to broader questions about whether AI infrastructure spending will generate adequate returns.