Global stock markets plunged on Friday, November 6, as a brutal sell-off in American technology and chip stocks spread across Asia, pushing Japan’s Nikkei 225 into a bear market and forcing South Korea’s stock exchange to halt trading.
The rout followed Wall Street’s worst single day since April 2025. All three major US indices recorded their steepest one-day falls since President Donald Trump’s tariff announcements triggered a global market rout that month. Investors are now asking whether the artificial intelligence boom that powered markets to record highs has run too far, too fast.
What happened on Wall Street
The tech-heavy Nasdaq Composite fell 5.52% on Thursday, November 5, closing at 24,315.00, down 1,421.52 points. The index is now 11.9% below its record close of 27,599.89 set on October 6, and the Nasdaq entered correction territory — a fall of more than 10% from a recent peak — for the second time this year.
The S&P 500 sank 4.36% to 7,353.73, and the Dow Jones Industrial Average dropped 1,833.06 points, or 3.44%, to 51,523.06. The falls more than erased Wednesday’s 1,569-point post-election rally, leaving the Dow below where it stood before the rally began.
Companies in the S&P 500 lost $2.9 trillion in market value in a single day, a record, according to Dow Jones Market Data cited by the Wall Street Journal. The Nasdaq shed more than $3 trillion, according to Bloomberg data cited by Fortune.
Semiconductor stocks took the worst of it. The Philadelphia Semiconductor Index plunged 12.25%, its worst single-day performance since the COVID-19 market crash in March 2020. Advanced Micro Devices (AMD) cratered 17.3% and Micron Technology fell 17.5%, while Arm Holdings lost 13.1%, Nvidia dropped 9.3% and Qualcomm fell 9.5%, according to official closing prices.
Tokyo and Seoul follow Wall Street down
The selling crossed the Pacific overnight. Japan’s Nikkei 225 fell more than 6% during Friday’s session, dropping below the 60,000 mark for the first time since May 20, according to NHK. The index is now more than 20% below its June peak, which puts it in bear market territory — a fall of 20% or more from a recent high. The broader Topix index fell 5.2%.
South Korea fared worse. The Kospi plunged 8.5% to 4,923, slipping below the psychologically important 5,000 mark. The steep decline triggered the exchange’s circuit breaker, forcing a 20-minute trading halt to cool the selling. Samsung Electronics fell about 10% and SK Hynix about 12%, while the smaller Kosdaq index dropped more than 7%.
The MSCI Asia-Pacific Index fell for a seventh straight session, its longest losing streak since August 2023.
Why markets are selling
The trigger was political. Democrats won control of both the House and the Senate in the midterm elections on November 3, and investors now fear that a Democratic Congress will slow or restrict the construction of the giant data centres that power the AI boom. Voters also backed ballot measures in several states curbing data-centre construction.
That fear hit the companies at the centre of the AI trade hardest. Chipmakers, memory producers and the cloud and infrastructure firms that supply them have seen their shares soar this year on expectations of almost unlimited spending on AI. On Thursday, investors began to question whether those companies can earn enough from AI to justify the hundreds of billions of dollars being poured into data centres.
A disappointing outlook from Qualcomm added to the pressure on chip stocks, and the selling spread from semiconductors to the wider technology sector. Tesla fell about 9.7% and Palantir about 8%, according to market reports.
What a bear market and a circuit breaker mean
A bear market is generally defined as a fall of 20% or more from a recent peak. It does not mean the market will keep falling, but it signals that investors have turned decisively pessimistic about the outlook.
A circuit breaker is a mechanism that temporarily halts trading when an index falls sharply in a short time. South Korea’s exchange uses it to give investors a pause during panic selling. The 20-minute halt on Friday was triggered when the Kospi’s losses passed the exchange’s threshold.
What happens next
Markets will be watching whether the selling continues when European markets open and when Wall Street resumes trading on Friday. Investors will also be listening for any signal from Democratic leaders about how they plan to handle data-centre regulation, and for further company results that show whether AI spending is still growing.
For now, the scale of the move is the story: in two days, markets went from celebrating a post-election rally to suffering their worst day in more than a year, and the damage has now spread from New York to Tokyo and Seoul.
FAQ
What is a bear market?
A bear market is a fall of 20% or more from a recent peak in a stock index. Japan’s Nikkei 225 entered one on Friday, November 6, after falling more than 20% from its June high.
What is a circuit breaker?
A circuit breaker temporarily halts trading when a market falls sharply, giving investors time to pause during heavy selling. South Korea’s Kospi triggered one on Friday, suspending trading for 20 minutes.
Why did chip stocks fall so sharply?
Investors fear that a Democratic Congress will slow data-centre construction, and they are questioning whether AI companies can earn enough to justify the huge sums being spent on AI infrastructure. A weak outlook from Qualcomm added to the pressure.
How bad was Wall Street’s day?
The Nasdaq fell 5.52%, the S&P 500 fell 4.36% and the Dow fell 3.44% on Thursday, November 5 — the worst single day for all three indices since April 2025.
Sources
- News18 — Global Market Crash: Nikkei Enters Bear Market, Kospi Crashes 8%; Nasdaq Correction Deepens as AI Stocks Bleed — https://www.news18.com/business/markets/global-market-crash-nikkei-enters-bear-market-kospi-crashes-8-nasdaq-correction-deepens-as-ai-stocks-bleed-10414846.html
- Nikkei Asia — South Korean exchange halts trading as AI stock sell-off accelerates — https://asia.nikkei.com/business/markets/south-korean-exchange-halts-trading-as-ai-stock-sell-off-accelerates
- Gulf News — Asian Markets Tumble as US Tech Stocks Plunge Amid AI Investment Concerns — https://gulfnews.com/business/markets/shares-plunge-in-tokyo-seoul-after-us-tech-rout-1.500737842
- NDTV Profit — Asian Markets Today: Nikkei Enters Bear Market, Kospi Crashes 9% — https://www.ndtvprofit.com/markets/asian-markets-today-crash-nikkei-enters-bear-market-kospi-crashes-9-percent-what-triggered-the-global-sell-off-nasdaq-ai-tech-stocks-democrats-12290415/amp/1
- NHK World — Nikkei 225 slumps after AI rout on Wall Street — https://www3.nhk.or.jp/nhkworld/news/20261106de71347/
- News18 — Nasdaq Crashes 5%, Down 11% In A Month: What’s Behind Bloodbath In US Chip Stocks? — https://www.news18.com/business/markets/us-market-crash-nasdaq-falls-5-us-chip-stocks-down-10414613.html
- JBizNews — Dow Plunges 1,833 Points as AI Selloff More Than Erases Election Rally; Nasdaq Falls 5.5% Deeper Into Correction — https://jbiznews.com/dow-ai-selloff-election-rally-nasdaq-correction-november-5-2026-close/
