1. Stock Market Today: Nasdaq Drops 5% as Wall Street Reverses Midterm Rally

U.S. stocks are experiencing a sharp selloff on Thursday as renewed concerns about artificial intelligence spending, semiconductor demand, and the future of data center construction overwhelm the optimism that drove Wednesday’s post-election rally.

By 11 a.m. Eastern time, the S&P 500 had fallen 3.2%, the Nasdaq Composite was down approximately 5%, and the Dow Jones Industrial Average had declined 1,146 points, or 2.1%, according to the Associated Press market report.

The Nasdaq’s decline puts the index on track for its worst daily performance since the April 2025 tariff-related market selloff. The technology-heavy index is also approaching correction territory following its recent record highs.

The semiconductor sector is leading the downturn. The Philadelphia Semiconductor Index dropped approximately 11%, reflecting widespread selling across companies involved in AI processors, memory chips, and data center infrastructure.

Nvidia ($NVDA), Advanced Micro Devices ($AMD), and Qualcomm ($QCOM) are among the biggest losers, while CoreWeave ($CRWV) and other AI infrastructure providers are facing additional pressure.

The selloff comes just one day after Democrats secured control of both chambers of Congress in the U.S. midterm elections. Investors are now considering whether political changes could lead to greater oversight of AI infrastructure development and delays in new data center projects.

The rapid reversal demonstrates how quickly market sentiment can change. Wednesday’s rally reflected expectations for political stability and potentially lower energy prices, but Thursday’s trading has shifted attention back to the financial and regulatory risks surrounding the AI industry.

2. Qualcomm Stock Crashes as Smartphone Chip Sales Fall 26%

Qualcomm ($QCOM) is at the center of Thursday’s technology selloff after reporting fourth-quarter results that exposed significant weakness in its smartphone business.

The semiconductor company reported fiscal fourth-quarter adjusted revenue of $10.44 billion, down approximately 7% year over year. Adjusted earnings reached $2.17 per share, compared with $3.00 in the same quarter last year.

The biggest concern was its handset business.

Qualcomm’s handset chip revenue fell 26% to $5.14 billion, missing analyst expectations of approximately $5.25 billion.

The decline reflects weaker smartphone demand, increasing memory costs, and lower revenue associated with its relationship with Apple ($AAPL).

As demand for AI data centers increases, semiconductor manufacturers are competing for memory components and manufacturing capacity. This is creating additional pressure on consumer electronics companies, which must manage higher production costs while dealing with weaker demand.

Qualcomm’s Forward Guidance Disappoints Investors

Qualcomm’s outlook for its next fiscal quarter added to investor concerns.

The company projected adjusted earnings between $2.15 and $2.35 per share, with the midpoint falling below Wall Street expectations of approximately $2.32.

Its chip segment revenue forecast also disappointed investors, while management indicated that rising input costs would put pressure on margins.

Qualcomm shares fell approximately 11% during Thursday’s trading, potentially wiping out more than $17 billion in market value.

However, the company is not abandoning its growth strategy. Qualcomm is expanding into automotive processors, Internet of Things devices, and AI data center technology.

Management expects non-handset revenue to grow more than 60% in fiscal 2027 and is maintaining its $5 billion data center revenue target.

The company also announced a multigenerational product collaboration with Amazon ($AMZN) focused on AI data centers.

For investors, Qualcomm illustrates the challenge facing semiconductor companies that are attempting to diversify beyond smartphones while their traditional businesses face pressure.

Read Reuters’ report on Qualcomm’s earnings and smartphone weakness.

3. Semiconductor Stocks Slide as AMD, Nvidia and Arm Face Growing Pressure

Qualcomm’s weak smartphone results are contributing to a much broader selloff across the semiconductor industry.

Several companies that benefited from the AI investment boom are experiencing significant declines as investors reduce exposure to the sector.

Among Thursday’s biggest losers:

• Advanced Micro Devices ($AMD) fell approximately 15.9%.
• Micron Technology ($MU) declined approximately 13%.
• Arm Holdings ($ARM) dropped approximately 11%.
• Nvidia ($NVDA) fell approximately 8.3%.
• CoreWeave ($CRWV) declined approximately 14.9%.
• GE Vernova ($GEV) lost approximately 9.1%.

The declines reflect concerns about both semiconductor demand and the economics of expanding AI infrastructure.

Arm Holdings Faces Questions About Royalty Revenue

Arm Holdings ($ARM) reported strong second-quarter fiscal 2027 results on Wednesday, but investors focused on a weaker-than-expected royalty business.

Revenue increased 27% year over year to $1.44 billion, while adjusted earnings reached $0.52 per share.

Licensing revenue increased 50% to $773 million, supported by demand for processor designs used in AI infrastructure and connected devices.

However, royalty revenue increased just 8% to $670 million, below analyst expectations of approximately $721 million.

This distinction matters because royalties are generated when companies actually ship products using Arm’s technology. Licensing revenue, on the other hand, can fluctuate depending on the timing of agreements and payments.

Investors are therefore watching royalty growth as an indicator of actual semiconductor demand.

Arm’s results demonstrate that the AI opportunity remains significant, but the market is increasingly focused on whether growth is translating into shipments, revenue, and sustainable profitability.

The Broader AI Infrastructure Concern

The latest declines also affect companies providing cloud computing capacity and data center equipment.

CoreWeave ($CRWV), Dell Technologies ($DELL), and other infrastructure businesses have faced selling pressure as investors reconsider the cost of expanding computing capacity.

The concern is that AI infrastructure spending could slow if new data center projects become more expensive, encounter regulatory restrictions, or take longer to generate acceptable returns.

For semiconductor investors, the current selloff represents a reassessment of future growth expectations rather than proof that AI demand has disappeared.

Read Reuters’ coverage of the global semiconductor selloff and Arm’s official second-quarter results.

4. Midterm Election Results Create New Risks for AI Data Center Companies

The political consequences of Tuesday’s U.S. midterm elections are becoming an important factor for technology investors.

Democrats secured control of both the House of Representatives and the Senate, creating a divided government for the remainder of President Donald Trump’s current term.

Beyond the implications for national legislation, the election results are raising concerns about the future of data center development.

Several candidates who opposed rapid data center expansion won important races in Texas and Georgia, two states that have attracted significant investment in AI infrastructure.

Local communities have also increasingly pushed back against new data center projects because of concerns about electricity consumption, water usage, environmental effects, and pressure on public infrastructure.

Some communities approved measures to restrict or pause new developments.

Why Data Center Restrictions Matter for Semiconductor Stocks

AI data centers require substantial quantities of advanced processors, memory, networking equipment, cooling systems, and electricity.

If construction slows, demand for these products could also grow more slowly than companies and investors currently expect.

The potential consequences extend throughout the technology supply chain.

Nvidia ($NVDA) and AMD ($AMD) could face slower demand growth for AI processors. Memory companies such as Micron ($MU) could experience changes in orders, while equipment suppliers and cloud computing operators could face delays in planned expansion projects.

According to reporting cited by Reuters, analysts at UBS estimated that approximately 30% of planned data center capacity for 2028 could be at risk from potential development restrictions and delays.

That figure represents an industry estimate, not confirmed cancellations.

It is also important to distinguish between local political decisions and federal policy. Democratic control of Congress does not automatically impose a nationwide data center moratorium. However, greater regulatory oversight and local opposition could make future projects more complicated and expensive.

For investors, the issue is whether the AI infrastructure industry can maintain its projected growth while navigating rising capital costs and political resistance.

Read Reuters’ analysis of AI infrastructure stocks following the midterm elections.

5. U.S. Productivity Surges 3.6% as Labor Costs Decline

Not all Thursday’s economic news is negative.

New government data showed that U.S. worker productivity increased at a significantly faster pace than economists expected during the third quarter, while unit labor costs declined.

The Bureau of Labor Statistics reported that nonfarm business productivity increased at an annualized rate of 3.6%, exceeding the Reuters economist consensus of 2.8%.

The increase followed a revised 2.1% gain during the second quarter.

Meanwhile, unit labor costs declined at an annualized rate of 0.7%, marking their first quarterly decrease since the second quarter of 2025.

Economists had expected unit labor costs to increase by approximately 0.6%.

These figures are important because productivity growth allows companies to generate more output without necessarily increasing labor expenses at the same rate.

When productivity improves, businesses may be able to increase profits while limiting price increases, potentially helping reduce inflationary pressure.

Weekly Jobless Claims Reach a 57-Year Low

The labor market also showed signs of resilience.

Initial claims for unemployment benefits declined to 189,000 during the week ending October 31, down 6,000 from the previous week.

The result was below economists’ expectations of approximately 197,000 claims and matched the lowest level recorded since 1969.

The relatively low number of layoffs suggests that employers are generally holding on to their existing workers, even as hiring conditions remain uneven.

However, continuing unemployment claims increased to approximately 1.72 million, indicating that some unemployed workers are taking longer to find new positions.

Together, productivity and employment data suggest that the U.S. economy retains some underlying strength despite volatility in financial markets.

For investors, faster productivity growth could be particularly important for the technology industry. AI adoption has the potential to improve operational efficiency, but the economic benefits will ultimately need to appear in company results.

The next major labor-market indicator will be Friday’s October employment report, which could influence expectations for the Federal Reserve’s December meeting.

Read Reuters’ report on U.S. productivity and labor costs and The Wall Street Journal’s report on jobless claims.

6. Bank of England Raises Interest Rates as Energy Inflation Remains a Concern

International financial markets are also reacting to an important policy decision from the United Kingdom.

The Bank of England raised its benchmark interest rate to 4.00% on Thursday, increasing borrowing costs by 25 basis points from the previous 3.75% level.

The decision passed by an 8-1 vote, with one policymaker favoring a larger increase to 4.25%.

It represents the Bank of England’s first interest-rate increase since 2023.

The central bank cited persistent inflation risks and higher energy costs associated with the ongoing Middle East conflict.

Policymakers warned that prolonged increases in oil and energy prices could spread through the economy, creating pressure on wages, consumer prices, and business expenses.

Several members indicated that another rate increase could be appropriate if inflationary pressures do not ease.

Why the Decision Matters for Global Investors

The Bank of England’s decision demonstrates that central banks outside the United States are increasingly concerned about the inflation consequences of geopolitical instability.

Higher interest rates can help control inflation, but they also increase borrowing costs for households and businesses.

For global markets, the decision reinforces the possibility that restrictive monetary policy could persist longer than investors initially expected.

U.S. investors are already dealing with uncertainty about the Federal Reserve’s next decision. The Bank of England’s move adds another signal that energy-driven inflation could limit central banks’ ability to ease monetary policy.

The interest-rate environment is especially relevant for technology companies that rely on financing to develop large data centers and expand their computing infrastructure.

Read Reuters’ report on the Bank of England’s November decision.

7. Oil Prices Rebound Above $97 as Iran War Uncertainty Returns

Oil prices recovered on Thursday after falling sharply earlier in the week following the Democratic election victory.

Brent crude futures increased approximately 2.6% to around $97 per barrel, reversing part of Wednesday’s decline.

The price recovery reflects renewed uncertainty surrounding the ongoing U.S. conflict with Iran and the future of energy supplies from the Middle East.

Political developments following the midterms have raised expectations that the Trump administration could reconsider its approach to the conflict. However, there is no confirmed agreement that would guarantee an immediate return to normal energy flows.

President Trump acknowledged that the war contributed to Republican losses in the elections, while Vice President JD Vance also publicly recognized the political cost of the conflict.

The market is therefore balancing hopes for diplomatic progress against the possibility of further escalation.

ConocoPhillips Delivers Strong Earnings and Raises Its Dividend

Energy company ConocoPhillips ($COP) reported stronger-than-expected third-quarter results on Thursday, benefiting from higher commodity prices.

The company generated adjusted earnings of $3.27 per share, exceeding analyst expectations of approximately $2.97.

Revenue and other income increased 29.2% to approximately $20.06 billion.

Average realized prices rose 32% year over year to $61.40 per barrel of oil equivalent, although production declined compared with the previous year.

ConocoPhillips also raised its quarterly ordinary dividend by 11% to $0.93 per share.

The company expects fourth-quarter production to reach between 2.32 million and 2.36 million barrels of oil equivalent per day.

The results demonstrate how higher commodity prices can support energy producers even when output declines.

However, the sector remains highly exposed to geopolitical developments. A sustained decline in oil prices could eventually reduce revenue and cash flow, while further supply disruptions could support stronger earnings.

Read Reuters’ report on ConocoPhillips’ third-quarter earnings.

8. AppLovin Surges 30% as Strong Advertising Results Defy Market Selloff

While semiconductor and AI infrastructure stocks are suffering, AppLovin ($APP) is moving sharply higher following a strong third-quarter earnings report.

The mobile advertising technology company reported revenue of $2.18 billion, an increase of 55% year over year.

Adjusted earnings reached $4.30 per share, exceeding analysts’ expectations of approximately $4.04.

Net income increased 72% to $1.44 billion, while adjusted EBITDA reached approximately $1.84 billion.

AppLovin also delivered stronger-than-expected fourth-quarter guidance, projecting revenue between $2.37 billion and $2.40 billion.

The company’s board approved an additional $3.2 billion in stock repurchases, bringing its total buyback authorization to $3.6 billion.

Shares surged approximately 20% in premarket trading and gained as much as 30% during the reported session.

The results are particularly significant because AppLovin has experienced substantial share-price volatility during 2026, making investors increasingly cautious about its growth outlook.

Its latest financial performance provides evidence that its advertising platform continues to generate strong revenue and profitability.

Unlike companies financing enormous physical infrastructure projects, AppLovin benefits from a technology business model that can expand advertising revenue without requiring comparable investments in data centers and specialized hardware.

The company’s performance illustrates why the current market downturn is not affecting every technology business equally.

Investors are distinguishing between businesses producing strong financial returns today and companies whose valuations depend heavily on future infrastructure demand.

Read AppLovin’s third-quarter earnings coverage.

9. Sony Raises Its Annual Profit Forecast After Strong Gaming and Movie Results

Sony Group ($SONY) also delivered encouraging financial results on Thursday, reporting strong growth in its second fiscal quarter.

The Japanese entertainment and technology company reported quarterly sales of 3.43 trillion yen, an increase of 10.3% year over year.

Operating income increased 45.1% to 622.3 billion yen, while net income reached 449.6 billion yen, representing growth of approximately 44%.

The company’s performance was driven largely by strong results in its Pictures and Game & Network Services businesses.

The box-office success of Spider-Man: Brand New Day helped increase profitability in its entertainment operations.

PlayStation also remained an important contributor, with monthly active users reaching 127 million, up from 119 million a year earlier.

Sony sold 2.6 million PlayStation 5 consoles during the quarter, down from 4 million in the comparable period last year. The decline reflects the aging product cycle of the console, which was introduced in 2020.

Despite this challenge, growth across its games, music, and pictures divisions allowed Sony to raise its full-year operating profit forecast to 1.3 trillion yen from its previous outlook of 1.2 trillion yen.

Its shares closed approximately 7% higher in Tokyo before the financial results were announced.

The results demonstrate how diversified entertainment businesses can generate strong earnings through successful intellectual property, digital services, and global consumer demand.

Read Associated Press’ coverage of Sony’s second-quarter results.

10. Stock Market Outlook: Friday’s Jobs Report Could Determine the Next Market Move

Thursday’s technology selloff has significantly changed the market outlook following Wednesday’s strong post-election rally.

Investors are now focused on whether the weakness in semiconductor and AI infrastructure stocks will spread into other industries.

Friday’s October employment report will be particularly important.

The report is scheduled for November 6 and will provide information about nonfarm payroll growth, unemployment, wages, and overall labor-market conditions.

A stronger-than-expected employment report could support the view that the U.S. economy remains resilient. However, it could also reinforce expectations for higher interest rates if wage and employment growth contribute to persistent inflation.

A weaker report could increase concerns about economic activity, although it might also strengthen the argument for future monetary easing.

Investors will also continue monitoring:

• AI spending: Whether major cloud providers and infrastructure companies can justify their capital expenditure plans.
• Semiconductor demand: Whether weakness in smartphones and memory costs will offset long-term AI-related growth.
• Political developments: Whether the new Democratic-controlled Congress and local governments pursue additional restrictions on data center construction.
• Energy prices: Whether the Iran conflict continues disrupting global supply and inflation expectations.

The current environment suggests that earnings quality and cash flow will remain more important than aggressive growth forecasts alone.

Final Takeaway

The stock market news for November 5, 2026, is dominated by a sharp reversal in technology stocks as investors reassess the financial and political risks surrounding artificial intelligence infrastructure.

The Nasdaq fell approximately 5% during the reported late-morning session, while the S&P 500 dropped 3.2% and the Dow lost more than 1,100 points.

Qualcomm’s weak smartphone chip revenue, disappointing forward guidance, and Arm’s softer royalty performance accelerated selling across semiconductor companies. Concerns about data center construction restrictions following the U.S. midterm elections added another layer of uncertainty.

However, the economic picture is not entirely negative. U.S. worker productivity increased 3.6%, unit labor costs declined, and initial jobless claims reached their lowest level since 1969.

AppLovin ($APP), ConocoPhillips ($COP), and Sony ($SONY) also delivered encouraging financial results, demonstrating that strong business performance can still attract investor interest during broader market weakness.

The next major catalyst will be Friday’s October employment report, which could influence expectations for Federal Reserve policy and the direction of financial markets.

The central market theme is that the AI investment cycle is entering a more demanding phase. Investors still recognize the industry’s long-term potential, but they are increasingly focused on actual demand, profitability, cash flow, and the regulatory environment required to support future growth.

This article is for informational purposes only and is not investment advice.

Sources

• Associated Press: A Wipeout for AI Stocks Sends Wall Street Reeling
• Reuters: Chip Selloff Drags Global Stocks Lower on AI Spending Concerns
• Reuters: Qualcomm Shares Slump as Weak Smartphone Chip Sales Overshadow Data Center Momentum
• SEC: Qualcomm Fiscal 2026 Fourth-Quarter Financial Results
• SEC: Arm Holdings Second-Quarter Fiscal 2027 Results
• Reuters: AI Data Center Stocks Decline Following Democratic Midterm Victory
• Reuters: U.S. Worker Productivity Surges in Third Quarter
• The Wall Street Journal: U.S. Initial Jobless Claims Fall to 189,000
• Reuters: Bank of England Raises Interest Rates to 4%
• Reuters: ConocoPhillips Beats Earnings Estimates and Raises Dividend
• Investing.com: AppLovin Surges on Strong Third-Quarter Earnings
• Associated Press: Sony Reports Strong Profit Growth on Spider-Man and PlayStation Success
• BLS: October 2026 Employment Situation Release Schedule