U.S. President Donald Trump blamed the midterm election results for causing $3 trillion in losses on the U.S. stock market on November 5. His latest comments came after a sharp sell-off in U.S. stocks and cryptocurrencies wiped out all the gains from the previous trading session.
In a November 8 post shared by The Kobeissi Letter, Trump described the election results as a “huge step backward in history.” The president linked the market decline to the Democratic Party’s victory, although concerns about investment in artificial intelligence also contributed to the sell-off.
The S&P 500 lost about $3 trillion in market value during Thursday’s trading session, while major technology companies recorded heavy losses. The Nasdaq Composite entered correction territory, and investors reassessed the outlook for spending on artificial intelligence (AI) infrastructure.
Trump Blames Democrats for $3 Trillion Stock Market Loss
Trump’s latest remarks came after a November 5 post on Truth Social in which he criticized the market’s reaction to the election. He argued that the Democrats’ victory had reversed gains made during his term and affected Americans’ retirement savings.
“The stock market has had one of the worst days in history based on the election results,” Trump wrote. He also blamed the Democrats for the decline, while insisting that the market could recover.
However, the sell-off followed a rally on November 4, when investors initially welcomed the election results. The S&P 500 rose 1.58%, while the Dow Jones Industrial Average gained about 3% during that trading session.
The reversal came as investors assessed how the new balance of power in Congress could affect corporate spending and technology regulations. The Democrats gained control of Congress, while several gubernatorial election wins raised questions about future data center approvals.
Some newly elected governors have proposed restrictions on large-scale artificial intelligence projects, particularly those requiring substantial electricity supplies. These proposals have raised concerns about data center expansion plans across several states.
However, proposed restrictions do not automatically become law, and governors face different approval requirements in each state. Markets have also responded to company valuations, technology spending, and expectations for future profits.
Nasdaq Falls 5.52% as AI Stocks Lead Wall Street Decline
The Nasdaq Composite fell 5.52% on November 5, closing at 24,315 after its steepest intraday drop in 19 months. Meanwhile, the S&P 500 fell 4.36% to 7,353.73, and the Dow Jones declined 3.44% to 51,523.06.
Technology companies recorded some of the biggest losses, with Nvidia shares falling about 9.3% in Thursday’s trading session. Advanced Micro Devices and Micron Technology each dropped about 17%, while the Philadelphia Semiconductor Index fell about 12%.
The decline reflected renewed concerns about spending on AI infrastructure and the expected financial returns from major technology investments. Investors also considered the funding needed to build data centers and secure electricity supplies.
The technology stock sell-off affected companies in the chip, cloud computing, and data center development sectors. However, some semiconductor stocks recovered in Friday’s trading session as buyers returned after the previous session’s declines.
The broader downturn spread to other sectors, with all 11 sectors of the S&P 500 falling on Thursday. The decline followed growing concerns about future regulations and the pace of corporate investment.
Meanwhile, the incoming Democratic majority is preparing to increase congressional scrutiny of Trump’s business interests and technology companies. The election results have spurred plans to investigate cryptocurrency businesses linked to Trump, although the new Congress will not convene until January.