US equities opened mixed on Thursday, with the Nasdaq Composite dropping 1.4% as semiconductor and AI infrastructure names extended their slide for a second session. The Dow Jones Industrial Average rose 212 points, while the S&P 500 slipped 0.53%.
The divergence followed a strong rally on Wednesday, when the Dow surged more than 1,500 points and both the S&P 500 and Nasdaq gained over 1%. Investors are now rotating away from tech-heavy sectors after Democrats secured majorities in both chambers of Congress, easing political uncertainty but raising questions about future AI regulation and data center expansion.
Chipmakers and AI Infrastructure Under Pressure
Qualcomm shares fell sharply after the company reported fourth-quarter results and issued an outlook that disappointed investors. The chipmaker missed Wall Street expectations for smartphone chip sales, citing sluggish demand and declining revenue tied to Apple. Qualcomm dropped 10% in trading.
Other semiconductor names also extended losses. Nvidia fell 3%, Marvell Technology declined 6.1%, and Intel slipped 5.56%. Broadcom traded 4.2% lower.
The weakness spread to companies involved in the AI infrastructure buildout. Data center operators IREN, Hut 8, and Applied Digital fell between 2% and 7%, while CoreWeave and Nebius declined between 4% and 8%. GE Vernova and Constellation Energy, which supply energy and equipment to data centers, also traded lower. Dell shares dropped more than 7%.
Investors are assessing whether Democratic control of Congress and victories in key states could lead to tighter restrictions on data center construction. Texas, Georgia, and Ohio are important locations for the industry's expansion.
Big Tech and Financials Gain
While chipmakers struggled, several large technology companies advanced. Amazon shares rose about 1.4%, and Alphabet gained approximately 1%. The rotation reflects expectations that a slower pace of AI infrastructure expansion could reduce capital expenditure requirements for major tech firms, potentially benefiting companies with substantial financial resources and diversified operations.
Financial stocks also supported the Dow. JPMorgan Chase and American Express each gained more than 1%.
Elsewhere, AppLovin shares surged around 30% after the advertising technology company reported better-than-expected third-quarter profit and issued an upbeat outlook. By contrast, Tesla and SpaceX extended their losses, falling more than 5% each.
Oil Rebounds Ahead of Jobs Data
Oil prices reversed part of Wednesday's sharp decline. West Texas Intermediate crude futures rose more than 1% to $89.72 a barrel, while Brent crude gained around 2.9% to above $97. The rebound followed an 8% drop in the previous session, when markets weighed the possibility that Democrats could increase pressure on the Trump administration to end the Iran war.
Oil prices have remained volatile amid concerns about potential supply disruptions in the Middle East. Investors are also monitoring comments from Federal Reserve officials, including Richmond Fed President Thomas Barkin, ahead of the October US jobs report scheduled for Friday.
This article is for informational purposes only and does not constitute financial advice.
