On November 5 local time, U.S. President Trump posted on social media, blaming the Democrats' midterm election victory for the massive sell-off in U.S. stocks that day.
He said: "Because of the election results, the stock market suffered one of the worst trading days in history. It's so sad to watch! We worked so hard to bring the stock market to unprecedented heights, and now it has turned out like this. Your 401(k) retirement accounts have shrunk as a result. Remember, this was not caused by Republicans, but by Democrats."
Trump also urged investors not to panic, saying the United States would soon become stronger than ever in some way.
Previously, the Democrats won control of both the Senate and the House of Representatives in the U.S. midterm elections on November 3. U.S. stocks initially reacted positively to the election results. On November 4, the Dow Jones Industrial Average rose 1,569 points, or 3%, while the S&P 500 and the Nasdaq Composite gained 1.6% and 1.4%, respectively.
However, the post-election rally lasted only one day. On November 5, the S&P 500 plunged 4.4% to 7,353.73 points, marking its largest single-day drop since April 2025. The Dow fell 1,833 points, or 3.4%, while the Nasdaq tumbled 5.5%, its worst performance in 18 months.
Tech stocks bore the brunt of the sell-off. As Democrats took control of Congress, and multiple state and local governments halted data center construction, investors began to worry that the expansion of AI infrastructure could slow down. According to statistics, at least 38 local jurisdictions have passed measures to pause or prohibit data center projects.
That day, NVIDIA shares fell about 9%, AMD dropped 17%, and Micron Technology declined more than 17%. The Nasdaq market lost approximately $2 trillion in total market value.
Although Trump blamed the Democrats' election victory for the stock market decline, the market had risen sharply the previous day due to the election results. This sell-off was mainly concentrated in AI and semiconductor sectors, reflecting investors' concerns about stricter data center regulation and the outlook for returns on AI investment.
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