Investors pivot from AI chipmakers to hyperscalers (5 Nov)

Election results and voter sentiment pressure AI infrastructure

AI infrastructure stocks remain under pressure following the Democrats’ sweeping midterm win, where the party secured control of both the House and the Senate. UBS strategists warned that nearly 30% of projected data-centre additions in 2028 could be delayed or cancelled as a result.

Investors are concerned that AI expansion will become more expensive and slower because voters rejected AI data centres in 40 out of 41 local ballot measures. This voter sentiment against AI, reported by CNBC, followed the election on Tuesday.

Semiconductor shares decline as tech stocks diverge

Tech stocks showed a clear divergence on Thursday 5 November 2026, as semiconductor shares continued to decline while other major tech firms rose. The S&P 500 was expected to have a near-flat start, with funds tracking the index rising 0.1% as of 8:20 a.m.

Semiconductor shares struggled, with the Direxion Daily Semiconductor Bull 3X ETF (SOXL) indicated to be down 11% on Thursday. Nvidia shares fell 2% in premarket trading, extending an 18% decline over the past month. Intel shares decreased 3% in premarket trading and have declined 51% over the past month.

Qualcomm fell 9.6% after missing fourth-quarter smartphone chip sales estimates. Marvell Technology shares fell 3.4%, and Nvidia dropped 0.8% in earlier reporting.

Conversely, Amazon shares rose 8% on Wednesday and added 2% in premarket trading on Thursday. Apple shares rose nearly 7% on Wednesday and added 1% in premarket trading on Thursday. Apple is trading near $354, and its high share price is contributing to the price-weighted Dow index performance. Amazon, Meta Platforms, and Alphabet each rose more than 1% in pre-market trading.

AppLovin jumped 20% after beating profit estimates. Conversely, Fair Isaac dropped 8.5% after missing fourth-quarter profit expectations. Snap declined 9% after reporting weaker-than-expected third-quarter revenue.

Finance.yahoo.com reported specific stock performance figures on 5 November 2026, noting NVDA at -1.68%, AAPL at +0.67%, and AMZN at +2.04%. The same source recorded the S&P 500 (^GSPC) at +1.58% and the SOXL ETF at -14.03%.

Analysts warn of risks for AI borrowers

Needham analyst Laura Martin described the current market landscape by stating, "Hyperscalers are AI incumbents".

Mark Malek of Siebert Financial identified risk in the sector, stating, "The most vulnerable AI companies are the borrowers, not the owners of AI capacity".

Mr Malek also commented that these companies are "not necessarily the biggest spenders".

Federal Reserve policy announcement looms

The Federal Reserve is scheduled to release its policy statement at 2 p.m. The top of the Federal Reserve’s target range is 4% ahead of this announcement.

Cleveland Federal Reserve President Beth Hammack said price pressures remain unacceptably high. She advocated for frequent smaller rate hikes to achieve 2% inflation and dissented from the decision to keep rates unchanged last week. Ms Hammack also defended the dollar’s status as the primary global reserve currency.

Market volatility and broader economic indicators

The VIX, which measures Wall Street’s concerns, is at nearly 21, representing an increase of 3 points from the previous week.

Brent crude futures rose more than 1% after falling over 8% in the previous session, easing investors’ inflation concerns.

Wendy's stock gained more than 2% on Thursday following third-quarter results that beat expectations.

Job market data shows seasonal hiring jump

Challenger, Gray & Christmas reported that planned job cuts increased 2% in October.

These cuts were down 71% year-over-year, marking the lowest October level since 2023.

Planned seasonal hiring jumped 57% from the prior year.