Nasdaq Loses a Historic $2.5 Trillion in Market Cap in AI Rout After Election

Summary of Nasdaq Loses a Historic $2.5 Trillion in Market Cap in AI Rout After Election

by The Wall Street Journal

11m•November 5, 2026
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Overview of The Wall Street Journal’s What's News PM Edition

This episode is a fast-moving roundup of major market, political, and international developments on Thursday, November 5. The biggest story was a historic sell-off in U.S. stocks—especially AI and tech names—while election results reshaped the political landscape, including the outlook for the Supreme Court. The show also covered Europe’s flight disruptions from bomb threats, political turmoil in Paraguay, China blocking a major SoftBank deal, and the quiet collapse of LIV Golf.

Market Turmoil: Nasdaq’s Historic AI Rout

  • U.S. stocks had a brutal session:
    • Nasdaq: down 5.5%, erasing $2.5 trillion in market value
    • S&P 500: down 4.4%, erasing $2.9 trillion
    • Dow Jones: down more than 1,800 points (3.4%)
  • Both the Nasdaq and S&P 500 logged their largest one-day declines on record.
  • The Nasdaq officially entered a correction, meaning it has fallen more than 10% from a recent high.
  • The sell-off hit:
    • chipmakers
    • power suppliers tied to data centers
    • software companies
  • Journal reporter Jack Pitcher said the decline reflected growing skepticism about the AI trade and whether the massive spending on data-center buildout will ultimately deliver enough profit to justify valuations.
  • A key point: yesterday’s tech weakness was partially masked by a broad market lift from falling oil prices, but today the weakness became visible across the entire market.

Politics: Election Results and the Supreme Court

  • Election results were still coming in, but one major outcome reported was:
    • Nithya Raman defeated incumbent Karen Bass in the Los Angeles mayor’s race.
      • Raman is a member of the Democratic Socialists of America.
  • The episode framed this as part of a broader leftward shift in some big-city politics.
  • On the national level, the show focused on the closing window for President Trump to appoint another conservative Supreme Court justice.
  • Journal Supreme Court reporter James Romoser said:
    • Justices Clarence Thomas and Samuel Alito are unlikely to retire now.
    • Democrats are expected to block any Trump nominee if a vacancy opens.
    • The election results effectively lock in the current Supreme Court composition for at least the next two years.
  • The report compared this to the earlier battle over Merrick Garland and the Ruth Bader Ginsburg seat, underscoring how Supreme Court vacancies have become deeply partisan.

Europe: Flight Disruptions From Bomb Threats

  • Europe experienced a second straight day of major aviation disruption after a wave of bomb threats.
  • One incident involved Rome’s main airport, where an email threat claimed explosives were on two flights bound for the city.
  • The flights were diverted, but no explosives were found.
  • Aviation reporter Ben Katz said:
    • Authorities treated more than 20 incidents this week as credible.
    • Responses included flight diversions, fighter jet escorts, and bomb squad sweeps.
  • He noted how vulnerable global aviation is to threats, since even false alarms can trigger costly, cascading disruptions.
  • Katz also warned that civilian aviation is increasingly being viewed as a target by states, militias, and other actors.

Other Global News

Paraguay’s President Resigns

  • Paraguay’s president, Santiago Peña, resigned amid political fallout from the collapse of Ueno Bank, which he was closely connected to.
  • Regulators said the bank lacked sufficient reserves, leaving customers unable to access accounts and sparking protests.
  • Peña apologized publicly and said it was never his intention to betray the public’s trust.

China Blocks a SoftBank Deal

  • Beijing blocked SoftBank’s $5.4 billion acquisition of ABB’s robotics unit.
  • China had approval power because it is ABB Robotics’ largest market.
  • The deal was important to SoftBank’s push into physical AI applications, so the rejection is a setback.

Business and Sports: LIV Golf Winds Down

  • LIV Golf is effectively shutting down after failing to stabilize financially.
  • The league had already entered bankruptcy court after Saudi Arabia’s Public Investment Fund pulled support earlier in the year.
  • After missing a key player-commitment deadline, the league is expected to wind down quietly in New Jersey bankruptcy court.
  • Players now face uncertainty, with some likely looking to the DP World Tour as a possible path back toward the PGA Tour.

Main Takeaways

  • The day’s defining theme was a violent reassessment of the AI and tech boom.
  • Election results appear to have strengthened Democrats’ hand, especially on the Supreme Court.
  • Global instability showed up in aviation, politics, and trade, with threats and regulatory action disrupting markets and major business deals.
  • Several high-profile stories—including LIV Golf’s collapse and SoftBank’s blocked acquisition—signal how quickly ambitious growth bets can unravel.