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Global Stocks Fall Sharply as AI Slowdown Fears Follow US Midterm Results
Global stocks drop as a US tech rout fuels AI slowdown fears after the midterm elections.
Key points
- The FTSE 100 fell 1.5%, or 166 points, to 10,615 at the start of trading on Friday.
- AstraZeneca opened down 2.8%, the biggest faller on the FTSE 100, while IAG fell 1.5% after missing profit forecasts.
- Wall Street's Vix jumped 61% to its highest level since the early weeks of the Iran war, signalling rising volatility.
Why it matters. Investors fear that a slowdown in datacentre build-out could shred the spending underpinning the AI boom at a time when they are already nervous about returns on the investment.
European markets opened lower on Friday as a rout in US tech shares spread across the Atlantic after the Democrats' midterm victory raised fears of an AI industry slowdown. The FTSE 100 fell 1.5%, or 166 points, to 10,615, while Japan's Nikkei 225 sank 6% and South Korea's Kospi tumbled more than 8%. On Thursday the Nasdaq slumped 5.5% in its worst day in 19 months, led by a 22% drop at SanDisk.
Latest updates
Global Stocks Fall Sharply as AI Slowdown Fears Follow US Midterm Results
Asian and European markets fell sharply on Friday, tracking a sell-off on Wall Street after the US midterm elections. The FTSE index was down as trading opened in London. The BBC reported that investors reacted to the possibility of tougher scrutiny of data centre construction and the wider AI industry. Asian markets plunged Friday, according to Al Jazeera, which linked the move to Western stocks. The sell-off follows a Democratic win in the midterms that recaptured control of Congress. Investors are now watching whether regulatory pressure on AI firms deepens.