European indexes fall as much as 1.5% as AI stock selloff spreads
Key Facts
European stocks fell in early trading on Friday, November 6, 2026, as a global selloff tied to concerns about AI regulation spread to the continent’s markets. Germany’s DAX lost 1.5% to 25,919.48 points, while France’s CAC 40 fell 1.1% to 8,117.65 points and Britain’s FTSE 100 dropped 1.4% to 10,635.51 points, according to the Associated Press. The decline followed US midterm election results that raised concerns about increased regulatory scrutiny of AI and a slowdown in data center construction. Investors turned to bonds for safety as pressure spread from technology stocks to global markets. In the previous session, the Stoxx 600 closed down 0.38% at 654.87 points, retreating from near a record high reached during the session.
Investors linked concerns that a Democratic-led Congress could seek to curb spending on AI data centers with broader worries about weak returns, elevated valuations and debt-funded investment, according to a Reuters report. The concerns come as major technology companies’ spending has become a support for the global economy, making any potential slowdown in AI spending a source of economic pressure. Reuters said a slowdown in this spending could weigh on the global economy, which has been supported by investment from major technology companies. An Associated Press poll also found that about three-quarters of US voters oppose a new data center in their communities. This public opposition adds a political dimension to the debate over expanding the infrastructure needed for AI.
Pressure spread across broad sectors in Europe, with media, health care and retail stocks each falling more than 2%, according to Reuters. European technology stocks also fell 3.2% in Thursday’s session, November 5, their lowest level in about two months, as chip stocks tracked Wall Street losses. In Friday trading, Soitec shares lost 2% and ASMI fell 1.3%, while Schneider Electric and Siemens Energy shares edged lower. An analyst at Swissquote said the move reflected a shift from technology to other sectors and from US to non-US markets after the midterm elections. An investment strategist at Sycomore Asset Management added that concerns about tighter AI regulation had not disappeared, but were currently balanced by strong investment in data centers and resilient corporate earnings.
Some companies posted steeper losses because of factors specific to their businesses and outlooks. Teleperformance shares fell 18% after the company cut its annual revenue growth forecast, as weakness in its trust and safety business overshadowed growth in AI-powered services and back-office services. In the defense sector, Rheinmetall shares fell 16.1% on Thursday after the company cut its 2026 sales outlook for the second time in three months, and the sector dropped 2.6%. In energy markets, Brent crude rose more than 2% on Thursday as investors watched the course of the war in Iran, adding to pressure on sentiment in Europe, an energy-importing region. The moves showed that the selloff reflected sector- and company-specific factors alongside AI-related concerns.
The selloff spread to Asia, where Japanese technology stocks, including SoftBank and Advantest, fell, while Samsung Electronics and SK Hynix shares also dropped as the Kospi declined. Taiwanese stocks closed down 4.5% on Friday, and the index posted a weekly loss of 12.2%, its biggest since 1991, according to LSEG data cited by Reuters. The euro fell to $1.1182 in Friday trading from $1.1219 in the previous period, according to the Associated Press. In Texas, Governor-elect Gina Hinojosa said on Thursday that the state would pass laws to protect residents regarding data centers, citing their impact on rural communities. Steve Sosnick, chief strategist at Interactive Brokers, said, "It is hard to believe that we can simply recover from here" after the damage markets had sustained.