AI stocks climb after trillions wiped from market values
Artificial intelligence and technology shares rebound following a massive sell-off, bolstered by stronger-than-expected US job growth of 165,000 in October 2026.
Stock photo for illustration only, not from the actual event
- Tech and AI stocks rebound following a massive global market sell-off
- The Nasdaq stock index recovers roughly 1.7% after plunging 5.5% earlier
- US employers add a stronger-than-expected 165,000 jobs in October
- Major chipmakers including Nvidia, AMD, and Micron post solid gains
Shares in artificial intelligence and technology firms have staged a recovery following an enormous market sell-off that erased trillions of dollars from stock values. The turbulence began in the United States on Thursday before spreading to Asian and European markets by Friday.
Investors had been offloading tech assets partly due to concerns that the Democratic victory in the midterm elections would lead to stricter regulations and slower development for artificial intelligence. However, the downward pressure eased when new US economic data was released on Friday morning.
Stock photo for illustration only, not from the actual event
The tech-heavy Nasdaq Composite opened higher on Friday and leveled out at around 1.7% higher by midday, clawing back some of its previous 5.5% drop. Meanwhile, the S&P 500 rose about 0.9%, and the Dow Jones Industrial Average nudged into positive territory after opening slightly lower.
Nvidia, which shed hundreds of billions in market value on Thursday after its shares fell more than 9%, opened Friday up over 6% before settling around 4% higher. SpaceX and Tesla experienced mixed gains of over 6% and nearly 5% respectively, while chipmakers AMD and Micron rebounded with increases of about 12% and over 8% after dropping more than 17% the previous day.
"Once investors have had the weekend to catch their breath, next week could give a clearer indication of whether the tech trade is going down the pan or fighting back."
Dan Coatsworth, AJ Bell
Asian and European markets experienced a more difficult session on Friday. South Korea's Kospi closed down 6%, driven by a more than 10% plunge in chipmaker SK Hynix. Major European indices in Germany, France, and Spain also ended the day lower, while the UK's FTSE 100 declined 1.01% amid ongoing domestic monetary policy pressures.
This market fluctuation highlights investor sensitivity to regulatory shifts and political changes, particularly regarding data center expansions and energy consumption concerns raised during recent political campaigns. While short-term macroeconomic indicators like the latest employment data show resilience, tech sector valuations remain closely tied to future regulatory developments and infrastructure spending returns.
Dan Coatsworth, head of markets at AJ Bell, noted it had been a brutal week for markets, emphasizing that the coming week will determine if the recent tech rally has staying power. According to the Bureau of Labor Statistics, the US economy added 165,000 jobs in October, well above analyst expectations, while the overall unemployment rate eased slightly to 4.1% from 4.2% in September.
Source: BBC Business
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