Stock market today: Nasdaq plunges 5% amid chip stock wipeout, Dow and S&P 500 erase post-election rally gains

US stocks fell suddenly on Thursday as AI and chip stocks sold off, erasing the gains from Wednesday’s post-election rally.

The Dow Jones Industrial Average (^DJI) tumbled 2.9%, or over 1,500 points. The S&P 500 (^GSPC) fell 3.8%, and the tech-heavy Nasdaq Composite (^IXIC) dropped 5.2%, putting the index on track to close in a correction.

The PHLX Semiconductor index (^SOX) dived 10% as Nvidia (NVDA), Micron (MU), and other chip names sank. Large-cap tech stocks were pacing for their worst day since the COVID-19 pandemic sell-off.

Investors continued to process the Democrats’ sweeping victory on Tuesday and its implications for markets and the economy. Amid relief that election uncertainty has been removed, the stock market continues to sort out the perceived winners and losers of a regime change on Capitol Hill.

Oil prices rose amid uncertainty that President Trump would pursue a deal with Iran to end the war in the Middle East. Optimism grew overnight after Vice President JD Vance said, “The reason we lost [the midterm elections] is the war,” in a post on X suggesting the party should push for a resolution to the conflict. Brent crude oil (BZ=F) prices traded around $97 per barrel, while US benchmark WTI crude (CL=F) stood at $90 per barrel.

51,698.80 -1,657.32 (-3.11%)

As of 1:46:44 PM EST. Market Open.

^DJI ^GSPC ^IXIC

A report from Challenger, Gray & Christmas showed layoff plans in October fell to the lowest level since 2023 as companies turned their attention to retaining existing employees, setting the scene for Friday’s key employment report.

On the earnings calendar, Duke Energy (DUK), Airbnb (ABNB), and Lumentum (LITE), among others, report results.

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AMD CEO Lisa Su on AI jitters and demand: Market is ‘a little bit short-sighted’

As AMD (AMD) stock falls 15% amid a chip stock rout on Thursday, the company’s CEO Lisa Su told Yahoo Finance’s Brian Sozzi she doesn’t see the AI chips demand slowing down anytime soon.

“I think the market can sometimes be a little bit short-sighted. It is what it is,” Su said on Sozzi Unleashed.

“Over the horizon, I see AI and super intelligence becoming more and more essential to every aspect of our lives and every aspect of our business,” Su added. “So I believe in this demand, and I very much believe that many of the investments that are being made throughout the ecosystem are also seeing some of these same trends.”

Palantir and CrowdStrike stocks tumble as Wall Street dumps software’s AI winners

Wall Street is dumping software’s AI winners and mostly leaving the losers alone. Palantir (PLTR) and CrowdStrike (CRWD) are both down more than 10% at their lows Thursday, while Salesforce (CRM) and Adobe (ADBE) are barely moving.

The sell-off that slaughtered chip stocks has spread to the software names most tied to the AI build-out. Palantir has shed about $40 billion in market value and is on pace for its worst day since February. The stock is now roughly a quarter below its Oct. 9 record and testing its 200-day moving average.

It has plenty of company. Cloudflare (NET), Rubrik (RBRK), Okta (OKTA), Palo Alto Networks (PANW), and Oracle (ORCL) are all posting steep losses, and Cloudflare is on pace for its worst day since May.

AlphaSpace heatmap

SpaceX, Tesla stocks tumble 9% as Democratic sweep raises questions on merger prospects, AI build-out

SpaceX (SPCX) and Tesla (TSLA) stocks extended declines on Thursday, each dropping more than 9%. Shares of the Elon Musk-led companies were pounded after Democrats won control of the House and Senate this week, raising concerns over regulatory hurdles for data center buildouts in the US and merger aspirations between the two companies.

The Democratic win in Texas, where both SpaceX and Tesla are headquartered, is at the center of the concern. The state flipped blue at the gubernatorial level and saw the Senate seat won by James Talarico, with whom Musk got into fierce spats on social media leading up to the elections.

“We will believe a SpaceX/Tesla merger happens but now faces a much tougher regulatory roadmap to get this deal done in 2027 given this new political blue roadmap in DC/Texas,” Yorkville’s partner and managing director Dan Ives wrote on Thursday.

Volatility spikes 65%, biggest jump since 2024

The CBOE Volatility Index (^VIX) just surged over 65% to as much as 27.45.

That marks the biggest one-day jump for Wall Street’s “fear gauge” in over two years, Futurum Equities chief market strategist Shay Boloor pointed out.

Volatility spiked as AI jitters took hold and investors dumped chip and tech stocks. Even yesterday’s post-election winners, including Apple (AAPL), turned lower.

Bitcoin dives as post-election stock rally fades

Bitcoin (BTC-USD) briefly tumbled below $76,000 on Thursday before stabilizing above the threshold as a broad sell-off in US stocks threatened to erase the previous day’s post-election rally.

The world’s largest cryptocurrency fell more than 5% Thursday, reversing a sharp rebound Wednesday that had lifted bitcoin above $80,000 as investors cheered midterm election results showing Democrats swept both chambers of Congress. The move has followed major indexes shedding their Wednesday gains.

Bitcoin’s retreat also underscored of the crypto market’s lingering fragility following $6.3 billion hack of Binance, the world’s largest cryptocurrency exchange, which rattled crypto prices last week.

The Democratic takeover of Congress also has raised fresh questions the crypto industry’s prospects in Washington, including passage of the industry’s long-stalled bill, the Clarity Act.

Brian Gardner, Stifel’s chief Washington policy strategist, said in a briefing with reporters on Thursday that the Clarity Act is unlikely to advance before the end of the year.

“It’s off the table for the lame duck session,” Gardner said, adding that the odds of a bipartisan compromise in the next Congress are “pretty low.”

Gardner added that he expects Senator Elizabeth Warren, who is poised to chair the Senate Banking Committee, to pursue investigations targeting crypto firms along with Wall Street banks and private equity firms.

Nasdaq plunges 4% amid chip stock wipeout

Stocks began diving on Thursday morning as chip stocks sold off, erasing roughly $2 trillion in market cap and reversing the gains made in yesterday’s post-election rally.

The Nasdaq fell roughly 4%, the S&P 500 dropped 2.3%, and the Dow shed over 700 points, or 1.4%.

Nvidia (NVDA), Micron (MU), and AMD (AMD) fell over 6%, 12%, and 13%, respectively.

Here’s a look at the wipeout hitting tech, AI, and chip stocks:

Stocks open mixed as tech fades post-election rally

US stocks were mixed Thursday as Wednesday’s post-election stock rally began to fade, tech stocks came under renewed pressure, and oil prices rebounded.

The Dow Jones Industrial Average (^DJI) rose 0.6%, while the S&P 500 (^GSPC) edged lower by 0.3%. The tech-heavy Nasdaq Composite (^IXIC) fell 1%.

51,698.80 -1,657.32 (-3.11%)

As of 1:46:44 PM EST. Market Open.

^DJI ^GSPC ^IXIC

Chip and data-center stocks were among the biggest laggards as investors continued to weigh what the Democratic sweep could mean for AI infrastructure spending and regulation. Qualcomm (QCOM) also sank after its quarterly results.

Oil prices bounced after Wednesday’s sharp sell-off, with Brent crude prices (BZ=F) climbing back above $97 per barrel.

AppLovin stock surges 23% as Q3 earnings, outlook beat estimates

AppLovin (APP) shares surged 23% in premarket trading on Thursday after the mobile app marketing company posted better-than-expected third-quarter profit and revenue and issued upbeat fourth-quarter guidance. Wall Street analysts raised their price target on the stock as results eased concerns over the company’s growth trajectory.

AppLovin’s third-quarter revenue of $2.18 billion topped analyst expectations of $2.07 billion, according to Bloomberg estimates.

Earnings per share came in at $4.30, ahead of the $4.04 consensus estimate. AppLovin issued a stronger-than-expected fourth-quarter forecast, projecting revenue between $2.37 billion and $2.40 billion, well above the $2.25 billion analysts had anticipated.

Wall Street analysts were quick to upgrade the stock, with BTIG raising its price target to $450 from $396 while maintaining a Buy rating, implying approximately 35% upside from current levels. Needham also reiterated its Buy rating with a $475 price target, implying an upside of roughly 43%

Wendy’s rejects Nelson Peltz’s $1.4 billion takeover offer

Wendy’s (WEN) said Thursday it has rejected a $1.4 billion buyout offer from billionaire investor Nelson Peltz’s Trian Fund Management on the grounds that it undervalues the company.

“The Independent Committee thoroughly evaluated this Proposal and unanimously concluded that it substantially undervalues Wendy’s standalone prospects and long-term earnings potential,” Wendy’s board chair Art Winkleblack wrote in a statement. “Our confidence rests firmly in Bob Wright’s proven track record of seasoned industry leadership, including restaurant business turnarounds.”

Wendy’s separately announced a multiyear strategic turnaround plan, called Dave’s Way, as it looks to stem declining sales and franchisees closing their locations.

The stock rose 1.5% in premarket trading.

Bank of England raises rates for first time since 2023

The Bank of England (BOE) voted 8-1 to raise interest rates by a quarter point to 4% on Thursday, with one member dissenting in favor of a larger hike. It marked the first interest rate hike by the UK’s central bank since 2023.

The bank sees inflation rising to 5% by mid 2027, and those inflationary pressures prompted the BOE to move.

“Today’s increase shouldn’t be seen as the first in an inevitable long sequence of hikes,” BOE Governor Andrew Bailey said. “But unless the conflict in the Middle East is resolved, neither does it seem likely to be the last increase.”

Trump’s Fed pressure campaign hits a new Democratic wall in the Senate

Yahoo Finance’s Jennifer Schonberger reports:

Democrats secured control of the Senate on Tuesday, a seismic shift that effectively blocks President Trump’s campaign to reshape the Federal Reserve and neutralizes what many analysts viewed as a threat to the central bank’s independence.

It also heightens the challenge for Trump should he maneuver to replace any sitting officials.

“Democrats’ control of the Senate reclaims the party’s ability to approve or deny the President’s nominees for judges and heads of other executive branch agencies,” Jonathan Pingle, an economist for UBS, wrote in a note. “That includes the need for Democrats to approve any new members of the Board of Governors of the Federal Reserve System should one of the existing governors step aside.”

Corporate earnings are growing like it’s 1984 — and that’s bad news for anyone waiting on lower rates

If you’re waiting for lower rates to buy a house, refinance, or pay down a credit card, corporate America may have bad news for you. Profits are growing so fast that one top economist says the economy could run at a pace last seen in 1984.

S&P 500 (^GSPC) earnings are up nearly 40% from a year ago, Apollo chief economist Torsten Sløk wrote in a Nov. 3 note. The economy is growing much more slowly, up about 6% in nominal terms, before adjusting for inflation. Strip out inflation and real GDP grew at a 3.4% annual rate in the third quarter. (Disclosure: Yahoo is a portfolio company of funds managed by affiliates of Apollo Global Management.)

By his math, “the current pace of earnings growth is consistent with nominal GDP growth of 10%,” Sløk wrote.

That would mean adding more than $3 trillion to a $33 trillion economy in a year. Outside the pandemic rebound of 2021-2022, the US hasn’t grown that fast since 1984, according to Yahoo Finance calculations from Commerce Department data.

US nominal GDP, percent change from a year earlier, quarterly, 1980 through Q3 2026 · US Bureau of Economic Analysis, Apollo, Yahoo Finance

Layoffs are muted and companies are expanding seasonal hiring plans: Challenger

Yahoo Finance’s Claire Boston reports:

Layoff plans in October fell to the lowest level since 2023 as companies turned their attention to retaining existing employees and adding seasonal help ahead of the holidays.

US employers announced 43,994 job cuts in October, up slightly from September but down 71% from a year earlier, according to outplacement firm Challenger, Gray & Christmas.

Job cuts have been muted this year as the labor market stays in “low hire, low fire” mode. Announced cuts in the first 10 months of the year are at their lowest level since 2022.

“This is a low-fire environment,” Andy Challenger, chief revenue officer at Challenger, said in a statement. “Employers are holding on to the workers they have heading into the holidays, and the hiring they are announcing is largely short-term, seasonal work. Companies want the flexibility to meet holiday demand without adding permanent headcount.”

Oil falls for a fourth day on expectations for lower risk of Iran war escalation

Reuters reports:

Oil prices fell for a fourth day on Thursday on expectations the losses US President Donald Trump’s Republican Party suffered in Congressional elections this week may reduce ‌the risk of further escalation of the US-Israeli war on Iran.

Brent futures fell 80 cents, or 0.85% to $93.82 a ‌barrel as of 0426 GMT, while US West Texas Intermediate crude futures were down $1.2, or 1.36%, to $86.92.

Both benchmarks tumbled by more than 8% in the previous session to settle at their lowest since August 31.

A weakened Trump, facing a Democratic Congress able to constrain his military options, has greater incentive to seek a deal, two sources close to Gulf government circles said on Wednesday. A full-scale assault on Iran now looks less likely, they said.

A resolution to the conflict could restore oil flows from the Middle East impacted by the war, though analysts caution the ‌way forward remains uncertain.

Good morning. Here’s what’s happening today.

Economic data: Challenger job cuts, year-on-year, October (-19.9% prior); Nonfarm productivity, third quarter preliminary reading (+3% expected, +1.4% prior); Initial jobless claims, week ended Oct. 31 (194,000 prior); Continuing claims, week ended Oct. 24 (1.701 million prior)

Earnings calendar: Toyota Motor Corporation (TM), ConocoPhillips (COP), Sony Group (SONY), Parker-Hannifin (PH), The Southern Company (SO), Cloudflare (NET), Duke Energy (DUK), Airbnb (ABNB), Monster Beverage Corporation (MNST), EOG Resources (EOG), National Grid (NGG), Cigna (CI), Lumentum (LITE), Simon Property Group (SPG)