Analyst Dan Ives of Yorkville Ives argues that the recent decline in tech stocks following the 2026 US midterm elections is excessive. On November 4, 2026, Democrats secured control of both the House and the Senate. Following this result, the Nasdaq Composite dropped between 3.7% and 5.5% intraday on November 5, while the S&P 500 fell between 2.1% and 4.4%.
Ives anticipates that capital expenditure by Big Tech and hyperscalers will surpass $1 trillion in 2027. Despite this long-term outlook, he warns that near-term uncertainty could delay the construction of AI-focused data centers. Specifically, he estimates that 10% of the planned 800 to 1,000 data centers in the US might not be completed due to regulatory challenges.
The analyst expects semiconductors to face further pressure in the near term, while identifying software and platform companies as potential beneficiaries. Key stocks highlighted include Apple, Microsoft, Alphabet, Amazon, Meta, Palantir, Snowflake, and CrowdStrike. Meanwhile, analyst Tom Lee forecasts a potential 20% rally in tech stocks following the market dip.
