Major U.S. stock indexes experienced steep declines on Thursday, November 7, 2024, following Democratic victories in the midterm elections, with the S&P 500 falling 4.4%, the Dow Jones Industrial Average dropping 1,833 points (3.4%), and the Nasdaq Composite falling 5.5%. The declines marked the worst single-day performance for the S&P 500 since April 2025 and the worst for the Nasdaq since March 2020, during the early stages of the COVID-19 pandemic. By Friday morning, markets showed partial recovery, with the Nasdaq up over 1.5%, the Dow slightly positive, and the S&P 500 gaining around 1%. The total market value wiped out on Thursday exceeded $2.3 trillion, according to Bloomberg data.
President Donald Trump attributed the market downturn to Democratic gains in the midterm elections, posting on Truth Social that the losses were a result of voters electing Democrats to control Congress. He wrote, “The Stock Market crashed today because the Dumocrats had a big Tuesday — So sad to see, you only have yourselves to blame!” Trump also referenced the market’s prior gains, stating, “It took so much work to get us to a level that no one has ever seen before, and then this.” He concluded with a pledge of future strength, writing, “Do not fear, however, we will soon, one way or the other, be BIGGER AND STRONGER THAN EVER BEFORE.”
The midterm elections saw Democrats secure control of both the Senate and House of Representatives, flipping seats in states including Ohio, Texas, Iowa, Maine, Michigan, and Kansas. The results represented a significant setback for Trump, who had campaigned extensively in several of these states in the weeks leading up to the vote. Some Democratic candidates emphasized cost-of-living issues, while Vice President JD Vance cited the ongoing U.S.–Iran war, cost of living, U.S.–Israel relations, and a perceived lack of “America first” policies as key voter concerns.
Market analysts and investors pointed to multiple factors contributing to the sell-off, including concerns over potential regulatory scrutiny of artificial intelligence (AI) and data center expansion under a Democratic-controlled Congress. The Nasdaq 100, which includes major tech companies such as Nvidia, Apple, and Alphabet, experienced its worst session since March 2020, dropping 6.4%. The decline in tech stocks was particularly pronounced, reflecting investor unease over future policy directions.
In Texas, the election of Governor-elect Gina Hinojosa, a Democrat, raised immediate questions about the future of data center construction in the state. Hinojosa has pledged to halt new data center projects until protections are implemented, citing voter concerns over AI and its societal impacts. Her victory over incumbent Republican Governor Greg Abbott—a figure Trump had previously criticized as a “RINO” (Republican in name only)—added to the political turbulence. Trump’s response to Abbott’s loss included a statement that Abbott would have won had he not been labeled a “RINO.”
The broader anti-data center sentiment extended beyond Texas, with Democratic gubernatorial wins in Ohio and Georgia also raising prospects of increased regulatory scrutiny over AI and data infrastructure. These developments contributed to a steep sell-off in tech stocks on Thursday, as investors anticipated potential policy shifts under the incoming Congress.
Key market movements on Thursday included:
- S&P 500: Down 4.36%, marking its worst day since April 2025.
- Dow Jones Industrial Average: Dropped 1,833.06 points (3.4%).
- Nasdaq Composite: Fell 5.52%, wiping out billions in market value.
- Nasdaq 100: Declined 6.4%, the worst session since March 2020.
By Friday, markets showed signs of stabilization, with partial rebounds across major indexes. However, analysts noted that investor sentiment remained fragile, particularly amid uncertainty over the policy agenda of the incoming Democratic-led Congress.
The midterm results and subsequent market reaction underscored the intersection of electoral outcomes, economic policy expectations, and investor confidence, with implications for both the political landscape and financial markets in the months ahead.