Nasdaq 100 drops 5% as AI-return doubts and election results hit tech stocks

The Nasdaq 100 fell 5% to a five-month low in mid-morning trading on November 5, 2026, as technology stocks suffered another sharp retreat. The broader Nasdaq Composite entered correction territory. NBC News linked the selling to mixed chipmaker earnings, doubts about AI investment returns and Democratic election victories that raised concerns about data-center construction.

The losses were not confined to technology. The S&P 500 fell nearly 3%, while the Dow Jones Industrial Average dropped almost 700 points. Those figures were trading snapshots, not closing results. The Nasdaq Composite’s move into correction territory marked a decline of at least 10%, the threshold used to describe a correction, rather than a 10% fall on Thursday alone.

Chip earnings sharpen doubts about the payoff

The immediate trigger was Wednesday night’s earnings reports from Qualcomm and Arm Holdings, according to NBC. Investors generally viewed both sets of results as mixed, and the companies led the Nasdaq indexes lower in early trading. Qualcomm fell 9%, while Arm dropped about 15%. The reaction placed two major chip businesses at the front of a retreat that spread across hardware suppliers and the broader market.

The earnings arrived against growing questions about whether AI will deliver enough productivity to generate returns on the money committed to it. Hundreds of billions of dollars are flowing into the sector, including chips and infrastructure needed to develop and operate AI. That investment helped fuel technology shares’ earlier rise: NBC put the Nasdaq’s gain since Election Day 2024 at almost 40%.

About −15%Arm Holdings

Arm fell about 15% after its earnings report.

−9%Qualcomm

Qualcomm declined 9% following its results.

−7%Nvidia

Nvidia lost 7% during Thursday’s sell-off.

Nvidia was the biggest contributor to the Dow’s decline. Its shares had already fallen 15% over the preceding three months, putting Thursday’s selling on top of a sustained retreat. The chipmaker’s role in the day’s losses also showed that pressure was not limited to the two companies whose earnings had supplied the immediate catalyst.

Memory and chip companies SanDisk, Western Digital, AMD, Seagate and Micron each plunged around 10%. Selling also reached businesses supplying other parts of the infrastructure buildout. Cisco and Caterpillar, both suppliers to AI data centers, fell around 5%.

Election pledges add construction uncertainty

Tuesday’s midterm results added a separate source of pressure to the same trading session. NBC reported that numerous Democrats elected as governors, attorneys general, senators and House members had pledged to slow or halt AI data-center construction. Texas, Ohio, Michigan and Georgia were particular concerns because they are large data-center markets. Those were campaign commitments, not confirmation that new construction restrictions had taken effect.

The political reaction also hit Elon Musk’s companies. Tesla and SpaceX each fell around 10%, moves NBC attributed largely to the election results. Musk had donated hundreds of millions of dollars to support Republican midterm candidates. The Democratic victories raised the prospect of tighter regulation and potential investigations affecting his companies at both state and federal levels, rather than announcing any such action.