On November 3, Gina Hinojosa (Democrat) defeated incumbent Republican Governor Greg Abbott to become Texas's first Democratic governor in decades and its first Latino governor, set to take office in January 2027.
On November 5, during a press conference, Gina Hinojosa stated: "When I become governor, I will issue a moratorium—banning all data center approvals until the legislature passes laws protecting Texans."
Over the past few years of rapid AI industry development, Texas has been the fastest-growing state in the U.S. for AI data center scale. Texas's relatively abundant electricity and cheap land have attracted major players like AWS, Microsoft, Google, and Meta to build large-scale AI computing centers.
Gina Hinojosa's call to "ban all data center approvals" is undoubtedly a major negative for tech companies and the AI industry.
Figure 1: Nasdaq 100 intraday trend - ATFX. Affected by the bearish news, the Nasdaq 100 plummeted 6.36% overnight, touching a low of 26,606 points. As shown in the chart above, the crash began at 22:30 Beijing time on the 5th, with the first downward pulse ending at 23:50. The Texas governor-elect's press conference took place at 04:00 Beijing time today. During Gina Hinojosa's remarks, the Nasdaq 100 experienced a second downward pulse.
Based on this, it appears the U.S. capital markets had already anticipated the negative news before the press conference began, with sizable funds fleeing tech stocks in search of safe havens.
Since one of Gina Hinojosa's core campaign positions was to restrict AI data center development, she is unlikely to soften her stance even in the face of violent stock market swings.
The AI industry currently faces high capital expenditure with low return expectations, obvious bottlenecks in hardware supply, and globally tightening monetary policy. Now, with data center expansion also facing obstacles, its future development outlook is not optimistic.
Beyond the U.S. Nasdaq 100, South Korea's KOSPI index (representing the high-speed memory sector) and China's optical module sector have also seen correlated declines.
Figure 2: Nasdaq 100 daily chart - ATFX. From a technical analysis perspective, the Nasdaq 100 is in the midst of a sharp, short-to-medium-term one-sided decline. The price has broken below the bottom of its previous consolidation range and formed an extremely large bearish candlestick yesterday, exhibiting a "guillotine" style breakdown. The multi-indicator matrix in the upper left corner shows overwhelming bearish signals.
Core indicators including the MA5/10/20 moving average system, MACD, RSI, KDJ (Stochastic), Ichimoku, and Alligator all point to BEAR, with only the ATR volatility indicator at NEUTRAL, indicating a high-momentum bearish trend.
While we remain bullish on Nasdaq's long-term bull market, given the market is currently in an extreme panic and high-momentum decline phase, blindly "buying the dip" should be avoided. It is recommended to adopt the mainstream trend-following strategy of shorting on rallies.
ATFX Risk Warning, Disclaimer, and Special Statement: Markets carry risk, and investment requires caution. The above content represents only the analyst's personal views and does not constitute any operational advice. Please do not treat this report as your sole reference. The analyst's views may change at different times, and updates will not be separately announced.
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