STOCKS | AI Stocks Recover as Nasdaq Rebounds After Its Biggest Drop in 19 Months

Nasdaq futures rebounded Friday after the Nasdaq Composite suffered its biggest plunge in 19 months, as investors bought chip stocks after the index entered correction territory. According to Sina Finance, the Nasdaq rose 1.27%, the S&P 500 gained 0.22%, and the Dow fell 0.99%; Nvidia advanced 5.66%, while higher Treasury yields after a strong October jobs report limited gains. Thursday’s selloff sent the Nasdaq down 5.5%, more than 10% below its recent high. The S&P 500 fell 4.4%, and the Dow dropped more than 1,800 points, or 3.4%. AI-related companies led declines amid concerns that Democratic election victories could bring tighter rules for data center construction. Texas Governor-elect Gina Hinojosa told CNN that the state needed to pause current data center construction until protective legislation was in place. About 40% of planned U.S. data center capacity is in states considering construction pauses. A total of 46 local ballot measures that could impede development have passed or are expected to pass, including at least 17 that directly prohibit large data centers. The October employment report showed 165,000 jobs added, above economists’ 59,000 estimate, while unemployment fell to 4.1% against expectations of 4.2%. The selloff also affected hedge funds: Walleye Capital is returning capital to some investors after its worst monthly performance since March 2020, Kirkoswald Asset Management recorded its largest monthly loss since inception, and Arini Capital Management lost more than 12% last month.