The Nasdaq Composite rose 1.24% on Friday, bouncing back from a sharp decline that pushed the exchange into correction territory, while the S&P 500 gained 0.75% and the Dow Jones Industrial Average fell 37 points, or 0.07%. The recovery marked a reversal after technology and chip stocks suffered heavy losses on Thursday as investors assessed what Democratic midterm election victories could mean for artificial intelligence regulation and data center investment.
Semiconductor stocks led the rebound. Nvidia climbed 6.5% after experiencing its worst day since January 2025, when Chinese artificial intelligence model DeepSeek sparked market concern. The broader semiconductor index rose over 6%, recovering from a plunge of more than 12% in the previous session. AMD, Intel, and Micron Technology each gained between 7% and 13%. According to eToro market analyst Jakub Rochlitz, the initial selloff reflected markets pricing in the midterm results after stocks had rallied on election day as political risk premium unwound.
Economic data released Friday showed mixed signals about the labour market. According to US payroll figures, the economy added 165,000 jobs in October, exceeding economists' estimates of 65,000 gains, while the unemployment rate fell to 4.1%. Heather Long, chief economist at Navy Federal Credit Union, said the encouraging sign was renewed hiring across industries as workers pursued expanding opportunities. However, Long noted wages remained below inflation levels, though wage growth in October came in stronger than forecast.
For US savers and investors, the volatility reflects uncertainty about whether Democratic control will lead to stronger regulation of artificial intelligence development and data centers, directly affecting technology stock valuations and retirement portfolio performance.