Stocks recovered some of Thursday’s losses on Friday after a sharp selloff the previous day fueled concerns about a possible slowdown in data-center construction.
The S&P 500 gained 23 points, or 0.3%, to finish at 7,377, though the advance did not offset its steep decline Thursday, its worst session since April 2025. The tech-heavy Nasdaq Composite rose 1.1%, while the Dow Jones Industrial Average fell 0.5%.
“Technology stocks are rebounding after two days of some of the most aggressive selling in a long time, although the rally remains tentative and muted, with little evidence of aggressive buying,” Adam Crisafulli, head of Vital Knowledge, wrote in a note to investors Friday.
Financial markets surged immediately after this week’s midterm elections, but reversed course Thursday as investors weighed whether sweeping Democratic victories could bring tighter restrictions on data-center development and weaken artificial-intelligence spending.
Democrats will control both the House and Senate when the newly elected lawmakers take office in January. However, President Trump will retain veto power, making major federal restrictions on data centers less likely. Wall Street analysts said opposition is more likely to emerge at the state and local levels.
By Friday, voters had approved more than 40 ballot measures restricting data centers in communities nationwide, according to an analysis by political research firm Redbud Consulting.
Technology shares began to regain ground Friday, helping lift the Nasdaq after its brutal session Thursday, when the index lost more than 1,400 points and entered a “correction”—a decline of at least 10% from its previous peak.
Chipmaker Nvidia, widely viewed as a bellwether for the AI industry, climbed 2.5% in afternoon trading, while semiconductor manufacturer Micron Technology advanced 3.9%. The so-called hyperscalers, which are driving the data-center buildout, posted more modest gains: Google parent Alphabet rose 0.8%, Amazon gained 0.9% and Meta climbed 2.1%. Microsoft slipped 0.6%.
IREN, which provides data centers, computing capacity and software for AI training, reported better-than-expected results for its latest quarter. Its shares jumped 19.2%, and the company announced two new contracts signed since the quarter ended.
EXPLORE MORE: NYC Marathon Runner Dies After Collapse With Two Miles Remaining
“We own the land, the power and the data centers that support the entire operation, giving us more ways to finance growth while allowing us to control its pace,” co-CEO Daniel Roberts said.
Outside the AI sector, trading was mixed, with declining stocks outnumbering advancers across the S&P 500.
Slowing AI investment?
One of Wall Street’s central questions is whether AI companies can deliver the revenue growth investors are counting on. Anthropic, which filed for an initial public offering last month and is expected to begin trading on the Nasdaq this month, will provide an important test. Its filing showed rapid growth, but the company has not yet become profitable.
In a research note Friday, Vicky Redwood, chief economic adviser at Capital Economics, said the firm expects AI to improve productivity but is “less confident that AI revenues will grow rapidly enough to support the current pace of investment.”
Capital Economics expects AI capital spending to slow next year, a shift Redwood said could weigh on U.S. economic growth.
Friday’s stock-market rebound followed the release of the jobs report, which showed strong payroll growth in October. Employers added 165,000 jobs last month, exceeding economists’ expectations, while the unemployment rate edged down to 4.1%.
The stronger hiring figures increase the likelihood that Federal Reserve officials will raise interest rates at their next meeting in December and again in 2027, according to Wall Street economists.
“A solid October jobs report leaves the Fed free to concentrate on inflation. We expect rate increases in December and March, with energy and AI spillovers representing the primary inflation risks,” Oxford Economics said in a report.
KEEP READING: Federal Agents Search Ilhan Omar’s Trash for DNA in ‘Dumpster-Diving’ Probe
