Wall Street’s AI trade suffered its worst day in 19 months, a warning for Saudi Arabia as it pours billions into the same data center boom investors are starting to doubt.
The Nasdaq Composite fell 5.5% on Thursday, its steepest drop since April 2025, CNBC reported. The S&P 500 lost 4.4% and the Dow Jones Industrial Average 3.4%, more than wiping out the previous day’s rally.
Chips took the hit
Nvidia and Qualcomm both fell more than 9%, and Nvidia lost almost $450 billion in market value in a single session. AMD, Micron and Applied Materials dropped by double digits, while data center operators CoreWeave and Nebius slid for a second day.
Why investors are nervous
Tech companies have committed enormous sums to data centers, chips and power. The spending comes now, while the revenue may take years. Rising interest rates and growing capital needs have made investors less willing to wait.
Politics added to the pressure. Democrats won control of both houses of Congress in Tuesday’s midterm elections, raising the prospect of tougher scrutiny of data centers’ power and water use, and of chip sales abroad.
The Saudi angle
The Kingdom has made AI one of its biggest bets. Aramco agreed this week to buy 49% of Humain, PIF’s AI company, which is aiming for more than six gigawatts of data center capacity and depends on American chips.
Power developer Acwa has also teamed up with US investor EIG on a venture with about $4 billion of equity to buy and build American power plants, betting that data centers will keep electricity demand rising.
Why it matters: demand for computing isn’t disappearing, but investors are getting pickier about what they will pay for future growth. For Saudi players, building capacity is only the first step. Signing paying customers is the real test.
What to watch: whether tech shares steady, and whether the selloff makes new AI projects harder or more expensive to finance.
