The Nasdaq Composite fell 5.52% on Thursday, November 5, 2026, its worst day since April 2025, one day after the Dow gained more than 1,500 points. Investors sold AI stocks after Democrats won Congress. Here is what moved the market, which stocks fell hardest, the case that the selloff overreacted, and the case that it did not.

The short answer

The Nasdaq Composite fell 5.52% to 24,315 on November 5, 2026, closing more than 10% below its October 6 record, which defines a correction. Investors sold AI stocks after Democrats won Congress, fearing limits on data center construction. Nvidia fell 9.2% and AMD 17.3%. No major company reported weaker earnings that day.

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Update, November 6, 2026: Technology stocks bounced, and the Nasdaq stayed in correction territory. The Nasdaq rose 1.09% to 24,579.42 on November 6, up 264.43 points, according to Yahoo Finance, which reported that chip stocks rebounded after Thursday's selloff. The S&P 500 rose 0.31% to 7,376.86, had its worst week since June, and the Dow fell 0.46% to 51,285.73. The Bureau of Labor Statistics reported 165,000 October jobs, and December Fed hike odds rose to about 77%. One day of gains does not end a correction. See why stocks were mixed after the October jobs report.

What happened to the Nasdaq on November 5, 2026?

The Nasdaq Composite fell 1,422 points, or 5.52%, to 24,315.00, according to CBS News and CNBC. Fox Business reported it as the index's worst day since April 2025 and placed the close at least 10% below the October 6 record close. The S&P 500 fell 4.36% to 7,353.73, and the Dow fell 1,833.06 points, or 3.44%, to 51,523.06. CNBC reported that the small-company Russell 2000 fell 4.45%, also into a correction. A correction is a drop of 10% or more from a recent high. A bear market is a drop of 20% or more. The Nasdaq sits in the first group and has not reached the second. For the Wednesday rally that preceded this drop, see why the Dow surged after the midterm elections.

Why did the Nasdaq fall after the midterm elections?

Reports point to three forces. The evidence shows they arrived together and cannot separate how much each contributed:

1. Fear of limits on data centers
Democrats won both the House and the Senate, and CNBC reported the worry is that tighter rules could slow data center construction. Sen. Bernie Sanders has called for a national data center moratorium. Fox Business reported that rising electricity prices had already made data centers a political issue. eToro's Jakub Rochlitz said markets were "pricing in the midterm results" after a political risk premium unwound.
2. AI company revenue depends on that construction
Chipmakers sell the processors that fill data centers, and data center operators rent the capacity. Rochlitz said the AI buildout may become slower and more expensive. Operators IREN, Applied Digital, and Nebius each fell more than 14%, per Fox Business, the largest moves among companies tied directly to new construction.
3. The sector was already under strain
October brought a report that OpenAI's revenue ran about $20 billion below earlier figures, a memory chip crash, and two cases of capital spending above operating cash flow, at Meta and Alphabet. See why tech stocks fell after Meta earnings and why Alphabet stock fell after earnings. Nvidia had already fallen 3.2% on November 4, according to CBS News, while the Dow rallied.

Which stocks fell the most on November 5?

Chip and AI infrastructure names took the largest losses, and the selling reached some companies outside technology. The reported moves for November 5:

  • Semiconductors: The Philadelphia Semiconductor Index fell more than 12%, per Fox Business. Nvidia fell 9.26%, AMD fell 17.3%, and Broadcom fell about 10%.
  • AI cloud and data centers: CoreWeave fell 9.8%, and IREN, Applied Digital, and Nebius each fell more than 14%.
  • Large technology and related companies: Tesla fell 10.77%, SpaceX fell 9.05%, Meta fell 3.96%, and Amazon and Alphabet each fell about 2%.
  • Beyond technology: Caterpillar fell about 6% and JPMorgan about 4%, per CNBC.

Reports give two different sizes for the drop in the semiconductor ETF SOXX, between roughly 11% and 12%, and CNBC called it the fund's worst day since March 2020. The spread of selling to banks and industrials shows investors cut risk broadly. Brent crude rose 2.6% to $97.11, recovering part of the previous day's nearly 9% drop, per CBS News. See whether the AI stock boom is a bubble for the longer debate.

The honest counterargument: is this a real change or a one-day overreaction?

The case for overreaction is strong. No company's earnings changed on November 5. The new Congress takes office in January, a moratorium would need to pass both chambers and avoid a presidential veto, and Democrats are divided on the idea, with Sen. Mark Warner reportedly calling it "idiocy." Argent Capital's Jed Ellerbroek called the selloff a possible "capitulation phase" but said the moves were outsized.

The case that the move is real is also strong:

  • The sector was stretched. The October evidence on OpenAI's revenue and on spending above cash flow raised financing questions before any election result.
  • Funding sources may narrow. Vital Knowledge's Adam Crisafulli said the selloff could delay Anthropic's IPO, which had been expected this month and could raise up to $100 billion, per CBS News.
  • Analysts see cracks. Capital Economics' Joe Maher said the AI boom is "in its final innings," and E*TRADE's Chris Larkin said "visible cracks" widened.

The fair resolution: the evidence shows a fragile sector hit by a political shock, and it cannot yet say whether the shock changes company earnings. Fourth-quarter reports and capital spending plans will test that. A forecast of either outcome is a guess.

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Figures come from same-day coverage. Index closes, stock moves, and analyst quotes come from CNBC, CBS News, and Fox Business reports published on November 5, and individual stock percentages differ by outlet. Treasury yield and mortgage rate closes for November 5 were not available when this was written.

What comes next for the Nasdaq?

Markets get three pieces of information soon. The Bureau of Labor Statistics releases the October jobs report on November 6, after September's gain of only 29,000 jobs. Fox Business reported that analysts expected more selling in Asia on Friday, after Japan's Nikkei and Korea's Kospi, both up more than 20% this year, dropped following the Wall Street rout. The Federal Reserve decides on rates December 8 to 9, and CME FedWatch put December hike odds at 70.1% on November 5, down from 82.7% a day earlier, per CNBC. See the Fed hike odds tracker. The Fed's October 28 statement left the rate at 3.75% to 4.00%.

What a beginner should actually do

  1. Decide before you check the balance. A plan written during calm weeks beats a choice made after a 5% day. See is a market correction coming.
  2. Find out how much technology you own. The companion post, what a Nasdaq correction means for your portfolio, shows how to check.
  3. Keep contributions on schedule. Regular contributions buy shares at every price, including lower ones.
  4. Rebalance only if your mix drifted past your own threshold. See should you rebalance during a market correction.
  5. Avoid a reaction in either direction. Selling after a drop and buying a single theme after a drop are both reactions, and the record favors a steady plan. See time in the market beats timing the market.
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The actionable takeaway: a correction in one index changes the price of your holdings and leaves your goals and timeline where they were. Your time horizon, your contribution schedule, and your allocation decide what a 5% day means for you.

The quick version

  • The Nasdaq Composite fell 5.52% to 24,315 on November 5, 2026, its worst day since April 2025
  • It closed more than 10% below its October 6 record, which is a correction, and has not reached the 20% bear market line
  • The S&P 500 fell 4.36% and the Dow fell 1,833 points, or 3.44%, a day after the Dow gained 1,569 points
  • Investors sold AI stocks on fears that Democrats will restrict data center construction
  • Nvidia fell 9.2%, AMD 17.3%, and the Philadelphia Semiconductor Index more than 12%
  • The overreaction case: no earnings changed, a new Congress arrives in January, and Democrats are divided on a moratorium
  • The real-change case: the sector was already stretched, and funding such as the Anthropic IPO may be delayed

One bad day and one political fear make a loud headline. A long-term plan has a calendar of years to work with, and a headline fits inside it.