A Democratic takeover of both chambers of Congress, fueled partly by campaign attacks on AI data centers, sent shockwaves through technology markets on Thursday, November 5, 2026.
The stocks that absorbed the most punishment were those that had climbed the highest, with Palantir (NASDAQ: PLTR) and CrowdStrike (NASDAQ: CRWD) each shedding close to 10% of their value in a single session.
Palantir’s losses were particularly severe, with the data analytics company erasing roughly $40 billion in market capitalization in what amounted to its worst single-day performance since February.
The stock now sits approximately 25% below the all-time record it set on October 9 and closed just above its 200-day moving average, a closely watched technical threshold.
The damage reflected how much these stocks had gained coming into Thursday: CrowdStrike had roughly doubled in 2026, Okta had more than doubled, and Palo Alto Networks was up nearly 90% before the session began.
Cloudflare, Rubrik, Okta, Palo Alto Networks, and Oracle all joined the sell-off, extending losses across the cohort of software companies most directly tied to the artificial intelligence infrastructure buildout.
The political backdrop mirrors what has already battered chipmakers, with Nvidia having shed nearly $1.4 trillion in market value since its own October record high.
Notably, the software sector’s worst-performing stocks this year proved the most resilient on Thursday, as names like Intuit, down nearly half in 2026, and Adobe and ServiceNow, each off around 30%, had little ground left to surrender.
The iShares Expanded Tech-Software ETF fell less than half as much as the VanEck Semiconductor ETF, a gap that partly reflects how much software had already declined, with the fund sitting roughly 16% below its September 2025 peak.
One standout defied the broader carnage entirely, with AppLovin surging 31% on strong quarterly earnings and a positive outlook, adding back in dollar terms much of what Palantir lost, though the stock remains down roughly half for the full year.
Thursday’s session underscored a brutal irony now facing AI software investors: the stocks that rewarded bulls most generously throughout 2026 have become the most exposed to a Washington policy environment that is growing increasingly hostile to the infrastructure underpinning them.
