Nasdaq Closes in Correction After a 5.5% Drop as the S&P 500 Has Its Worst Day Since April 2025

Wall Street gave back the whole of Wednesday's celebration and then some. The S&P 500 closed on Thursday at 7,353.73, down 334.89 points or 4.36 percent, its worst day since April 2025, while the Nasdaq Composite fell 1,421.52 points, or 5.52 percent, to 24,315.00, Fox Business reported in its closing summary. The Dow Jones Industrial Average lost 1,833.06 points, or 3.44 percent, to 51,523.06.

Only a day earlier the Dow had jumped 1,569 points in its best post-midterm session since 1982. That gain was erased in a single afternoon. The Nasdaq finished in correction territory, more than 10 percent below the record close it set on 6 October.

Why did the Nasdaq fall 5.5 percent on Thursday?

The proximate cause was artificial intelligence, and specifically the buildings that AI runs in. Investors worried that the Democratic sweep of Congress and the statehouses would slow the construction of data centres, CNBC reported, with Senator Bernie Sanders already calling for a national moratorium. Rising electricity bills have made the facilities a political issue, and Spectrum News added that borrowing costs and fears of an AI bubble fed the unease.

The damage then spread. Strategist Keith Lerner told CNBC the tech selloff was "feeding itself into the broader market." The Cboe Volatility Index touched 28.09 at one point, its highest since 31 March.

Which stocks fell the most?

Chipmakers took the worst of it. Nvidia fell 9.26 percent to $181.60, shedding roughly $374 billion of market value from Wednesday's close, and Broadcom lost about 10 percent. Fox put the drop in the Philadelphia Semiconductor Index at more than 12 percent; CNBC said the iShares semiconductor ETF had its worst day since March 2020. Spectrum News listed Advanced Micro Devices down 17.3 percent and CoreWeave down 9.8 percent.