Investors are reassessing artificial-intelligence equities and data-center spending after hedge funds reduced exposure and the Nasdaq plunged 5.56% on Nov. 5 following Democratic control of Congress in the midterm elections. Concerns over tighter U.S. data-center oversight, higher electricity costs, borrowing requirements and regulatory scrutiny have pressured major suppliers including Samsung Electronics, SK Hynix and Taiwan Semiconductor Manufacturing. The Cboe Volatility Index surged 69.66% from 16.61 to 28.18 before easing to 25.64, while renewed U.S. strikes against Iranian air defenses on Qeshm Island and tensions around the Strait of Hormuz added geopolitical and oil-market risks. Strong October employment data, including 165,000 new jobs and 4.1% unemployment, led futures markets to price roughly a 78% probability of a December Federal Reserve rate hike. Asian investors have also rotated toward Chinese, Indian and other sectors less dependent on AI; a Hong Kong gauge tracking mainland companies rose 5.2% last week, India’s Nifty 50 gained 8.6%, and foreign funds invested a net $1.9 billion in Indian shares through Nov. 4. Prediction-market pricing for higher Anthropic valuation targets has fallen, although Friday’s technology rebound shows investors have not entirely abandoned the AI growth thesis.