AI Stocks Halt Global Slide as Nvidia Rebounds

Global stock markets stopped falling Friday as investors reversed a sharp two-day decline in artificial intelligence shares. The recovery followed a week of volatility driven by Democratic midterm election victories and concerns over the cost of building AI infrastructure. The S&P 500 rose 0.5%, limiting its weekly loss to 2.5%.

Nvidia, the chipmaker central to the AI boom, led the rebound. Its stock gained 2.6% on Friday after dropping 9.3% on Wednesday and 3.2% on Thursday. The company’s performance helped stabilize the Nasdaq composite, which was up 1% as of 1:01 p.m. Eastern time. The Dow Jones Industrial Average lagged, falling 88 points, or 0.2%.

The sell-off had spread internationally earlier in the week. Japanese and South Korean indexes each dropped 6% following the U.S. market plunge on Thursday, which was the worst single-day loss since April 2025. Germany’s DAX index lost 1.9% despite having fewer AI-related companies than American markets. Friday’s stability in New York halted this global decline.

Investors were worried that Democratic control of state governments, particularly in Texas, would slow data center construction. Voters across parties expressed concern about rising power bills tied to these facilities. These political fears joined existing anxieties about high borrowing costs and potential stock bubbles in the AI sector.

Corporate earnings provided support for the tech sector. IREN, a data center provider, saw its stock jump 15.8% after beating quarterly estimates. Co-CEO Daniel Roberts noted that owning land, power, and data centers gives the company flexibility to fund growth. Lam Research rose 7.5% after announcing a share buyback program worth up to $25 billion. CoreWeave climbed 1.4% and Micron Technology gained 3.8%.

Outside the AI sector, results were mixed. Axon Enterprise fell 18.4% after reporting weaker-than-expected results and announcing a $1.2 billion investment in drone firm Skydio. Charter Communications dropped 2.4% after posting a quarterly loss when analysts predicted a profit. More stocks in the S&P 500 declined than rose on the day.

In bond markets, Treasury yields stabilized after earlier weekly drops. The 10-year Treasury yield eased to 4.83% from 4.84% on Thursday, down from a high above 5.30% last month. Stronger-than-expected job growth data suggested the U.S. economy remains resilient despite high inflation. Traders increased the probability of a Federal Reserve rate hike in December based on this data.

The University of Michigan’s preliminary consumer sentiment report showed improved outlooks for lower- and middle-wealth Americans. Inflation expectations for the coming year also eased, a factor that helps prevent a cycle where high inflation expectations worsen actual price increases.