The Democrats’ victory in the U.S. midterm elections split the tech sector.

While the broader market rose in response to the result, some AI stocks moved in the opposite direction. The Nasdaq-100 gained 1.14% to close at 28,500, rebounding after an overnight sell-off that briefly sent futures down more than 2%.

Microsoft shares rose 6.01% to $552.32, while Alphabet gained 4.63% to $292.99. Investors are likely betting that divided control of Congress will limit sweeping policy changes, and that software companies are less dependent on physical infrastructure.

Hardware and chipmakers, by contrast, came under pressure. Nvidia fell 2.19% to $202.17, Tesla dropped 3.61% to $384.10, and Intel slid 5.80% to $57.04. According to Reuters, the main reason was concern over increased scrutiny of data centers, which Democrats made a politically contentious issue after their victories in Texas and Georgia.

Two factors added to the pressure on memory makers. Apple warned that rising memory prices would hurt gross margins and would likely remain elevated beyond the December quarter. Meanwhile, Chinese rival CXMT plans to send customers samples of its first server DRAM based on 4F² architecture by the end of the year. BofA Securities believes successful mass production could strengthen CXMT’s position, although the technology carries higher costs and execution risks.

What this means for the market

Nick Ferris of Vantage Point Asset Management noted that Democrats will likely push for stricter regulation of the industry. In his view, two key risks—return on investment and funding for the boom—have become “more complicated.” Dan Ives of Yorkville Ives & Co. called the Texas election result the “biggest concern” for tech investors and the AI trade, as the state could account for 25–30% of planned gigawatts.

Bitcoin, meanwhile, recovered above $80,000 and traded around $80,512, gaining 4.12% on the day. Trump Media shares fell 14.29% to $5.10, extending a decline that began well before the election. The direct impact of the tech sector’s split on the crypto market is limited, but segments tied to AI computing and mining could face additional volatility amid tighter regulation.#USMidterms-WhatAreMarketsExpecting? #TRUMPFalls18.1%In24HoursToRecordLow #BTCRebounds80K #ADPUSPrivateEmployersAdd86000JobsInOctober