U.S. stock futures and Asian technology shares fell on Wednesday as early midterm election results appeared to show Democrats heading for control of both chambers of Congress. Investors weighed whether greater oversight of artificial intelligence and data-center investment could weaken the technology rally.
S&P 500 futures were down 1.1% in after-hours trading. Japan’s Nikkei 225 fell 3.6% to its lowest intraday level in three months, while Taiwan’s stock index dropped 3% to a three-month low. South Korea’s KOSPI declined 2.9%.
Markets had recently expected Democrats to win the House, with the Senate race considered closer. Early results suggesting a broader Democratic victory brought the potential effect on U.S. AI policy into sharper focus, including the large sums being invested in data centers.
Asian markets have outperformed U.S. and European counterparts for much of the year, supported by relatively attractive valuations and strong demand for AI hardware. Alicia Garcia-Herrero, Natixis’s chief economist for the Asia-Pacific region, attributed the day’s regional sell-off to AI-related concerns. She said investors were worried that Democratic oversight could slow data-center investment, but did not expect the party to halt it altogether.
Sources: The New York Times Business.