AI stocks halt brutal sell-off as Wall Street trims its loss
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NEW YORK -- AI stocks bounced back Friday and recovered some of their sell-off from the last two days. The rest of the U.S. stock market was mixed, though, following a whirlwind few days of Wall Street trying to sort out what this week's sweeping victories by Democrats in the U.S. midterm elections will mean for the economy.
The S&P 500 rose 0.3% and trimmed its loss for the week to 2.7%, which was its worst since President Donald Trump shook markets in April 2025 with his "Liberation Day" tariffs. The Dow Jones Industrial Average dropped 237 points, or 0.5%, and the Nasdaq composite climbed 1.1%.
The relative steadiness for Wall Street halted what had been a worldwide tumble for stocks. Indexes dropped 6% in Tokyo and in Seoul following the U.S. market's plunge on Thursday. European indexes have fewer stocks tied to the artificial-intelligence industry, but Germany's DAX nevertheless lost 1.9%.
Friday's biggest lift for the S&P 500 came from Nvidia, the chip company that's become the face of the boom and possible bust of the AI frenzy. Its stock climbed 2.8%, coming off drops of 9.3% and 3.2%.
It and other companies tied to the build-out of AI data centers tumbled this week on worries that Democratic victories in statehouses across the country could mean a slowdown in further construction, particularly in Texas. Voters across political parties say they're wary about AI and don't like increases to power bills caused by data centers.
That built on top of worries already rattling the industry that further construction of AI data centers may slow because of how expensive it's become to borrow money. Before that, even, critics were saying AI stock prices had shot too high and were in a bubble.
But political power in Washington will still be split between a Democratic Congress and a White House run by the Republican Trump, who retains the power to veto. That could limit federal efforts to rein in the AI industry.
In the meantime, companies in the industry still see strong growth.
IREN, a company that delivers data centers, compute and software for AI training, reported stronger results for the latest quarter than analysts expected. Its stock jumped 20%, and it also announced two new contracts signed since the end of the quarter.
Lam Research, a company whose equipment and services help make semiconductors, climbed 8.2% after announcing a program to send up to $25 billion to its investors by buying back shares of its own stock.
That helped other stocks that have benefited from the build-out of AI data centers recover some of their own sharp losses. CoreWeave, which rents out access to AI chips to customers over the cloud, rose 6.3%. Micron Technology, which sells memory for computers, climbed 5.1%.
Outside of AI, the U.S. stock market was mixed, and more stocks fell within the S&P 500 than rose.
Axon Enterprise tumbled 18.2% after the seller of Tasers reported weaker results for the latest quarter than analysts expected. It also announced a $1.2 billion investment in Skydio, a drone technology company.
Charter Communications sank 6.2% after the internet and video provider reported a loss for the latest quarter, when analysts were expecting a profit.