Trillions of dollars have been wiped off the stock value of major tech firms in the US, Europe and Asia after the US midterm elections sparked concerns of a slowdown in artificial intelligence (AI) development.
In the US, the tech-heavy Nasdaq share index fell 5.5% on Thursday, losing an estimated $2.5tn (£1.9tn) in market value, while other key US stock indexes also saw big losses.
Investors appear worried about tougher regulation of AI, after Democrat candidates expressed their opposition to the data centres that are needed to power the technology.
The share falls comes on top of broader concerns about whether the huge amounts being spent on AI will pay off.
The sell-off in US stocks on Thursday meant the so-called magnificent seven tech companies, including Apple, Nvidia and Tesla, shed a trillion dollars in value in a single trading day.
Nvidia shares slid more than 9% and other chipmakers also suffered, with AMD and Micron both dropping by more than 17%.
Shares in Elon Musk's companies SpaceX and Tesla also plunged, falling 8% and nearly 11% respectively and shaving more than $300bn off the firms' market value.
Musk had spent nearly $450m backing Republican campaigns, including at least $45m in support of Ken Paxton for the Texas senate seat, but Texas was turned blue in the Democratic tsunami on Tuesday night.
Tech stocks in Europe were also hit, with shares in chipmaker Infineon down by more than 8.5% while tech equipment manufacturer ASML dropped 6.5%.
The sell-off spread into Asia on Friday. The Nikkei share index in Japan closed down 6% as shares in memory chip makers Kioxia and Tokyo Electron saw big falls.
In South Korea, chipmaker SK Hynix fell more than 10% and Samsung was down 6.4%. The Kospi share index ended the day down 6%.
The falls mark a "continuation of worries" over the level of spending on AI infrastructure, said MarketWatch chips analyst Britney Nguyen.
Democrats in races across the US campaigned to slow the growth of data centres and AI, and there were dozens of measures on ballots around the country aimed at restricting the development of the hubs crucial for powering the technology.
They won both the US Senate and House of Representatives in Tuesday's midterms, taking control of Congress for the rest of President Donald Trump's presidency.
Texas' Democratic governor-elect Gina Hinojosa campaigned heavily against data centres, pledging a moratorium on new construction in the sector.
In a social media post, Trump blamed the slide on his political opponents.
"The Stock Market suffered one of the Worst Days in History based on the results of the Election," he said.
"Remember, it wasn't Republicans, it was Dumocrats. Do not fear, however, we will soon, one way or the other, be BIGGER AND STRONGER THAN EVER BEFORE. MAKE AMERICA GREAT AGAIN!"
Later on Thursday night he appeared to take aim at voters too.
"The Stock Market crashed today because the Dumocrats had a big Tuesday — So sad to see, you only have yourselves to blame!" he wrote on Truth Social.
Some Democrats have argued that AI has grown too big without any safeguards or oversight and have promised, with their new power in Congress, to change that.
"Americans don't want Big Tech oligarchs wrecking the environment, gutting jobs and threatening humanity's future. NATIONAL DATA CENTER MORATORIUM NOW," Democrat Senator Bernie Sanders said in a post on X on Thursday.
Susannah Streeter, chief investment strategist at Wealth Club, said the steep sell-off in US stocks had sent shockwaves into other markets.
"Fresh panic over the AI trade has hit Wall Street hard," she said.
"Fears that the vast sums poured into AI infrastructure may not deliver the returns investors have been banking on are now colliding with the prospect of a sharp slowdown in data centre construction.
Some tech leaders have said they were caught off guard by the backlash against data centres in the midterms.
OpenAI president and co-founder Greg Brockman said he believed everyone had been surprised by the reaction to data centres, and more work needed to be done to ensure communities were on board.
"A lot of our shift over the course of this year has really been to realise that from San Francisco trying to build infrastructure in Texas, Georgia, and other places, you can't just tweet and say: 'This is going to be good.' You need to be in those communities," Brockman said at the WSJ Tech conference in Napa, California on Wednesday evening.
Meta's president Dina Powell McCormick said that the industry needed to put more effort into selling AI as a good idea.
"I think we need to double and triple down on telling the story," she told the WSJ conference.
Alongside the immediate impacts of the US mid-term elections, some investors have also become concerned that AI shares could be in a bubble that is due a correction.
With additional reporting from Lily Jamali
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