Nasdaq 100 drops over 1,000 points as tech stocks sell off
The Nasdaq 100 has fallen more than 1,000 points on Thursday, 5 November, as concerns over the expansion of AI infrastructure weigh on technology stocks. Meanwhile, healthcare and consumer staples attract buyers. IG’s US Tech 100 cash indication trades at around 27,040 points in the afternoon. Failure to hold the psychological 27,000 level could open the way towards 26,000. A more meaningful recovery would require buyers to reclaim 27,800.
Why is the Nasdaq 100 falling today?
Following the Democrats’ election victory, investors fear tighter restrictions and potential delays in the construction of new data centres. These concerns add to existing doubts about whether the billions being invested in artificial intelligence will generate sufficient returns. Semiconductor manufacturers and companies involved in the AI infrastructure buildout are particularly exposed to the selling.
Out of tech and into defensive stocks: Healthcare companies and consumer staples are attracting demand as investors reduce their exposure to AI-related shares. This rotation suggests that earnings reliability is gaining importance. The influence of large technology companies is particularly visible: at one stage, a small majority of S&P 500 constituents advanced even as the overall index fell sharply.
Nasdaq 100 daily chart: 27,000 comes under pressure
The sell-off has pushed the Nasdaq 100 below its recent low around 27,500 points. The 27,000 level has also been briefly breached, making this psychological threshold a key area to watch for signs of stabilisation.
An RSI (34) reading below 48.5 would reinforce the weak momentum picture. However, the speed of the decline also leaves room for sharp technical rebounds. A bounce alone would need further confirmation before signalling a more durable recovery.