Nikkei falls 3.56% to 60,835.36 as investor anxiety builds ahead of U.S. election results
Key Facts
The Nikkei 225 fell 3.56% to 60,835.36 in Wednesday morning trading, Nov. 4, 2026, shedding 2,246.50 points in what the Associated Press described as the index’s biggest drop since early May. The decline came as global markets followed the results of the U.S. midterm elections held Tuesday. Technology and artificial intelligence shares faced waves of selling as investors worried that valuations had risen too far. Pressure spread to chip-related companies across Asia. The move coincided with markets watching whether the election results could affect the direction of regulation for AI development.
Japanese technology-related shares posted sharp losses: SoftBank fell 8%, while Kioxia dropped 10.8%. The Associated Press linked Kioxia’s losses to the company’s October-to-December outlook, which fell short of market expectations. The moves showed the sensitivity of AI- and chip-related shares to growth and spending expectations in the sector. In South Korea, the Kospi fell 3.2% to 5,466.83. SK Hynix dropped 3.2% and Samsung Electronics fell 1.8%, extending losses among memory-chip companies in both markets.
Political concerns are tied to speculation among some Wall Street traders that a sweeping Democratic victory in Congress could lead to more regulation and restrictions on AI development. But President Donald Trump will remain in office and retain the ability to veto legislation, the Associated Press reported. An analyst at SBI Asset Management said the AI market may begin to worry about the politicians who control the power grid. This comes after technology and AI shares faced waves of selling over concerns that prices had climbed too high. Valuation concerns and uncertainty over the policy direction after the election thus converged.
Against the backdrop of market moves, the U.S. job openings report showed hires rising to 5.402 million in September from 5.271 million in August. Total separations increased to 5.319 million from 5.175 million. Quits also rose to 3.4 million in September, while layoffs and discharges held at 1.6 million, little changed. The Associated Press said the job openings report, which showed companies advertising more jobs than economists expected at the end of September, pushed the 10-year U.S. Treasury yield to 4.96% in early Wednesday trading, from 4.91% late Monday. Markets are awaiting the official October jobs report, scheduled for Friday, Nov. 6, at 8:30 a.m. Eastern time.
In currency markets, the dollar fell to 157.76 yen in early Wednesday trading, from 158.69 yen late Tuesday. Brent crude fell 0.5% to $103.14 a barrel, while U.S. crude declined 0.7% to $95.45. These moves offer a broader picture of Asian trading alongside the stock market decline, with currencies, bonds and energy assets moving in different directions. In the U.S., the previous session’s performance ahead of the Associated Press report was mixed: the S&P 500 rose 0.4% and the Nasdaq Composite gained 0.8%, while the Dow Jones fell 197 points, or 0.4%. DuPont and Celanese shares also rose 8.6% and 5%, respectively, after both companies reported stronger-than-expected quarterly earnings.
Midterm election results remain a focus for investors, alongside technology and AI stock valuations and the outlook for sector regulation. The Associated Press quoted an analyst at Edward Jones as saying the S&P 500 has delivered a positive return every time in the six months following midterm elections since 1970. That figure provides historical context for trading, while the market’s immediate focus remains on the vote results and their political implications. Among upcoming U.S. data, the October jobs report is due Friday, Nov. 6, at 8:30 a.m. Eastern time. The report will give investors the latest reading on the labor market following September’s job openings data.