US tech stocks recovered on Tuesday afternoon following a period of investor volatility regarding artificial intelligence spending. The Nasdaq increased 0.83% for the day, while the S&P 500 rose 0.37% at market close. This rebound follows a brief selloff that saw the Nasdaq enter correction territory after dropping 10% from its October 6 record close.
Nvidia gained 2.3% after a four-session decline, and chipmakers Advanced Micro Devices, Broadcom, and Micron Technology also saw share price increases. Conversely, the Dow dropped 0.38% as Apple shares fell 1.9% following a margin forecast that missed expectations due to rising memory chip costs.
Market performance occurred alongside the US midterm elections. While investors anticipate Democrats may secure a House majority and potentially gain Senate seats—which could lead to increased AI regulation—the elections did not appear to have a significant immediate impact on Wall Street. Historical analysis from CNBC indicates that markets often experience jitteriness before elections but tend to pick up once results are settled.
Other market factors contributed to the recovery, including a drop in oil prices. Brent crude fell to $103 a barrel on Tuesday from $117 a barrel at the end of October, amid potential new negotiations involving Iran and Russia.
Despite voter frustration regarding the cost of living, Wall Street has maintained significant growth driven by AI infrastructure and chip investments. The S&P 500 has risen 10% so far this year, while the Nasdaq and the Dow have increased by 9% and 7%, respectively.
