Stock market crash: S&P 500 drops 4.4%, Nasdaq in correction on AI fears
Wall Street had its worst day since April 2025 on Thursday as AI and chip stocks collapsed. The numbers, the reasons, and what it could mean for Pakistan.
Wall Street had its worst day in a year and a half on Thursday, 5 November. The S&P 500 fell 4.4%, or 334.89 points, to close at 7,353.73, its biggest one-day drop since the “Liberation Day” tariff shock of April 2025. The tech-heavy Nasdaq composite lost 5.5% to 24,315.00 and is now 11.9% below the record it set last month, which puts it in a “correction”.
The Dow Jones Industrial Average sank 1,833 points, or 3.4%, to 51,523.06. The fall wiped out the previous day’s gain, which had been the market’s best in three months.
Which stocks fell the most?
The selling was led by the companies that have ridden the artificial intelligence boom:
| Stock | Thursday’s move |
|---|---|
| AMD | -17.3% |
| CoreWeave | -9.8% |
| Nvidia | about -9.3% |
| GE Vernova | -7.5% |
Nvidia, the biggest drag on the S&P 500, is now down 2.6% for the year after gaining roughly 39%, 171% and 239% in the three years before. More than 50 tech stocks in the wider S&P 1500 dropped 10% or more in a single day. One of the few winners was AppLovin, which jumped 31% after strong results and a buyback of up to $3.2 billion.
Why did the market crash?
Several worries hit at once:
- The US midterms. Democrats did well in Tuesday’s elections, and many voters are uneasy about AI and about higher electricity bills from giant data centres. Investors fear some governments could slow or pause new data-centre construction. President Donald Trump blamed the Democrats for the fall.
- The AI bubble debate. Critics have warned for months that AI share prices ran ahead of real profits.
- Expensive borrowing. High interest rates make it costlier to build the data centres AI needs.
- The war in the Middle East, which keeps oil prices jumpy.
Keith Lerner, chief investment officer at Truist Advisory Services, described it as “something of a buyers’ strike in tech”.
The sell-off spread beyond New York. South Korea’s Kospi fell 5.3% and Japan’s Nikkei 225 lost 1.8%. Brent crude rose 3.9% to $98.29 a barrel, recovering part of a nearly 9% drop the day before, and Bitcoin slid to around $76,000.
What it means for Pakistan
The Pakistan Stock Exchange was not part of Thursday’s fall: the KSE-100 had already closed 3,366 points higher at 175,379.87 before New York opened. Friday’s session will show whether the global mood reaches Karachi, as it already did in Seoul and Tokyo.
Oil matters more to Pakistan than tech shares do. With fuel prices now reviewed far more often, a Brent price near $100 feeds into what Pakistanis pay at the pump. A slowdown in AI spending could also touch Pakistani freelancers and IT firms that sell AI-related work to American clients, though there is no sign of that yet.
The next big test for AI shares is Anthropic’s planned stock market listing, which investors now say could be delayed.
This is information, not investment advice.
