Trump Blames Midterm Election Results for US Stock Market Rout

what happened

US President Donald Trump blamed the midterm election results for a sharp sell-off in American stocks. In a post on Truth Social, he wrote that the stock market, which he said had been a ‘rocketship’ under him, lost $3 trillion in a single day, and promised markets would come back ‘bigger and stronger’ without explaining how.

Investors feared that Democrats, who won majorities in both chambers of Congress, could tighten oversight of AI and restrict data center construction. Markets rose at first after the November 3 vote, adding about $1.2 trillion in capitalization, but sentiment reversed. On November 5 stocks fell sharply into negative territory, and the Nasdaq recorded its biggest one-day decline since ‘Liberation Day’ in April 2025, according to Stocktwits citing The Kobeissi Letter.

Since November 3, the QQQ fund, which tracks the Nasdaq, has lost nearly 5%, one of the broad indexes has slipped about 2.7%, and the DIA has edged about 1% lower.

why it matters

The Kobeissi Letter argues that the election alone does not explain the drop, since the outcome was largely priced in. Its main suspect is growing concern about strict AI regulation, possibly even a ban, combined with heavy leverage that could force liquidations by major institutional investors. In its view, the selloff is more technical than fundamental. On Stocktwits, retail sentiment on SPY and QQQ was bearish, while it was bullish on DIA.

market impact

US tech stocks: AI regulation fears weigh on the Nasdaq

• ▼Nasdaq 100 and US tech stocks pressure down — fears of tighter AI rules and slower data center construction
• ▼Broad US stock market pressure down — the tech sell-off drags other indexes lower as well

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