SpaceX shares plunge as tech and AI stocks fall

SpaceX shares dropped more than 7% in early trading on Friday following the Democratic sweep in the US midterm elections, a move that pulled down other technology and artificial‑intelligence stocks.

The decline contributed to the Nasdaq Composite, which is heavily weighted towards tech, slipping by over 5% at one stage in the morning session.

Analysts say the market is reacting to the prospect of stricter oversight of data‑centre construction and the AI sector after Democrats won in key data‑centre states such as Texas.

Elon Musk had reportedly contributed nearly $450 million to Republican campaigns, including at least $45 million backing Ken Paxton’s Texas Senate bid, yet the state flipped blue on Tuesday night.

Governor‑elect Gina Hinojosa, who campaigned on limiting data‑centre projects, pledged a moratorium on new construction in that industry.

OpenAI president and co‑founder Greg Brockman told the WSJ Tech conference in Napa, California on Wednesday evening that the industry was surprised by the backlash and that more effort was needed to win community support, saying, "A lot of our shift over the course of this year has really been to realise that from San Francisco trying to build infrastructure in Texas, Georgia, and other places, you can't just tweet and say: 'This is going to be good.' You need to be in those communities."

Meta president Dina Powell McCormick echoed the call for better messaging at the same conference, stating, "I think we need to double and triple down on telling the story."

Shares of chip makers also slumped, with AMD down nearly 17% over five days, Micron falling more than 20%, Intel losing over 18%, Nvidia dropping over 10% and the Philadelphia Semiconductor Index sliding more than 13%.

Some investors have warned that AI equities may be in a bubble that could face a correction, adding to the sell‑off triggered by the election outcome.