Following the U.S. midterm elections, major stock indexes plunged, led by AI-related shares. The Nikkei 225 fell to below ¥60,000, and concern is spreading over the future of AI investment.
After the Democratic Party regained majorities in both houses of Congress in the U.S., stocks fell across the board on 5 November, led by AI stocks, including data center-related names. The Nasdaq Composite fell 5.5% and the S&P 500 fell 4.4%.
The election results heightened concern over the conditions surrounding AI investment. While data center development to expand computing capacity is necessary to run AI, it was pointed out that the outlook for recovering investment could become uncertain because of regulation and local opposition.
In Texas, the new governor has proposed suspending data center approvals, highlighting the conflict between the burden on residents of supplying electricity and water and companies’ future earnings prospects.
This situation shows how conflicting interests, namely national growth investment and the burden on local residents’ livelihoods, are affecting the progress of AI investment and its acceptance by local communities.