Technology Stocks’ 5.5% Drop Tracks Selloff Spreading to Crypto Markets
Key Facts
U.S. stocks fell on Nov. 5, with the Nasdaq Composite down 5.5% and the S&P 500 declining 4.4%, according to the Associated Press. The drop came amid a selloff led by stocks tied to building AI data centers, in a session when pressure spread to higher-risk asset markets. In the cryptocurrency market, the reported percentage decline in Ether and its price level in the initial report could not be verified against a reliable open source. The total flows into U.S.-listed Ether exchange-traded funds on Nov. 5 also could not be confirmed, as the available tracking page showed partial data for that day. As a result, no verified figures are available to measure Ether’s move or link it to fund flows in that session.
Reuters attributed the decline in U.S. stocks to weak Qualcomm results and concerns that the U.S. Congress, controlled by Democrats, could slow investment in AI infrastructure. The pressure was especially pronounced among chipmakers, with the Philadelphia Semiconductor Index falling 12.2% on Nov. 5. That was the index’s biggest one-day drop since April 2025, according to a Reuters report carried by Euronext. A research executive at GSR said investors feared political opposition to data-center expansion could slow the construction of AI infrastructure. He added that existing concerns about returns on spending for that expansion remained a factor in the selloff.
By Nov. 5, the Nasdaq had fallen more than 10% from its record close on Oct. 6, according to Reuters via MarketScreener. Sameer Samana of the Wells Fargo Investment Institute said a shift to unified control by another party could bring uncertainty and abrupt policy changes. The sharp decline puts technology stocks in the context of investors reassessing the AI spending boom. Political concerns about investment coincided with worries about the returns that spending could generate, according to the GSR research executive. In the same U.S. session, chip stocks fell more sharply than the major indexes, with the Philadelphia Semiconductor Index losing 12.2%.
In U.S. economic data released on Nov. 5, the Labor Department said 189,000 people filed for unemployment benefits in the week before the report, down from 195,000 the previous week. The four-week average of claims fell to 194,750, and weekly claims were at their lowest level since mid-July, according to the Associated Press. Unemployment claims are an indicator of layoffs, and economists track them for insight into labor-market trends. The weekly reading was below the previous week’s figure, but on its own does not establish the cause of moves in cryptocurrencies or stocks during the session. Available coverage linked the stock declines to concerns about AI spending, Qualcomm’s results and political concerns about data-center expansion.
The selloff spread to Asia on Friday, Nov. 6, following Wall Street’s decline, with South Korea’s Kospi falling 6.3% to 5,042.65 points, according to the Associated Press. This followed a day when the Nasdaq dropped 5.5% and the S&P 500 fell 4.4% in the United States. The Philadelphia Semiconductor Index had also lost 12.2% on Nov. 5, reflecting pressure on chipmakers tied to AI infrastructure. Figures for Ether’s decline and its fund flows on Nov. 5 remain unconfirmed in the available information and therefore cannot be presented as settled totals for the session. The latest dated development in these events is the extension of the stock decline to the South Korean market on Friday.