Millions of UK savers caught up in tech stock sell-off after US midterm elections

US and tech and AI giants led a shares rout on Thursday that spread to stock markets around the world tumbling on Friday

Stock markets plunged on Friday as the Democrats’ sweeping victory in America’s midterm elections triggered a tech stocks bloodbath.

Hundreds of billions of pounds were wiped off the value of companies around the world as investors were left spooked.

It follow a more than £2trillion Wall Street rout on Thursday, with AI tech companies bearing the brunt of the loses.

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AI giant Anthropic’s mega stock market listing has been thrown into some doubt by the events of recent days. The developer of the Claude tool had been aiming to float on the market in the next fortnight with a value of around £1.1trillion.

Meanwhile, tycoon Elon Musk has seen his wealth drop by around £60billion in recent days as a result of the share price slump. The Tesla and SpaceX boss remains the richest person in the world, with estimated fortune of £568billion.

Jensen Huang, chief executive of AI chip giant Nvidia, dropped off the list of the world’s wealthiest people, after his fortune fell by £10billion.

The so-called Magnificent Seven tech heavyweights – Alphabet, Amazon, Apple, Tesla, Meta Platforms, Microsoft, and Nvidia – lost more than £750billion in combined market value in a single session on Thursday. There were signs that the tech sell-off of those companies had stabilised on Friday, with the potential for a rebound rally.

The UK’s FTSE 100 slumped more than 2% at one stage on Friday, putting it on track for its worse day since March, despite having very few tech-related companies on the index.

The turmoil was caused by the Democrats drubbing of Donald Trump’s Republican party in the US midterm elections this week, prompting investors to worry that the rollout of vast data centres crucial for the development of artificial intelligence (AI) will be delayed. Many newly elected governors and senators in the US have expressed opposition, raising concerns about how much money has been pumped into AI company stocks.

Ben Barringer, head of technology research at wealth manager Quilter Cheviot, said: “With the market now having digested this week’s midterm election results, it has decided it doesn’t like the look of what it sees from a technology perspective.”

The value of Bitcoin also fell sharply, with investors concerned that chances of a Donald Trump administration-led deregulation of the crypto industry now looking a lot less certain.

Millions of UK savers have been caught-up in the stock market sell-off. people with a workplace pension are at high risk of being exposed to the stock market jitters given their retirement pot is likely to be invested in part in equities, including US tech companies given their dominance, even if they may not realise it. The same goes for many savers with money in stock market linked funds.

Chris Beauchamp, chief market analyst at investing and trading platform IG, explained: “If you hold a global equity market fund then you are bound to have tech exposure. These are some of the biggest companies in the world and make up a big part of major stock markets.

“But you will also be holding a broad range of other companies that are much less affected and have seen less selling in recent days. It’s understandable to be worried, but the S&P 500 is still up 7% from the start of the year and 24% from the start of 2025, while the FTSE 100 is up 8% for the year and 30% from the start of 2025. It’s normal to be worried, but overreacting is likely to lead to doing the wrong thing.”

Danni Hewson, head of financial analysis at broker AJ Bell, said: “After initially seeming to shrug off concerns about what a Democrat blue wave in the midterm elections might mean for the AI trade, panic set in on Thursday.”