AI Rules and Data Center Opposition Rattle Tech Shares

After midterm victories gave Democrats control of Congress, lawmakers began preparing legislation to require independent testing of advanced AI, clarify companies’ liability for harms and protect consumers from electricity-cost increases tied to data centers. Investor fears of tighter rules and opposition to data-center expansion contributed to a sharp technology-stock sell-off that erased more than $2 trillion in market value and spread to Asian markets; concerns about high AI valuations, infrastructure spending, financing costs and returns also weighed on shares. Voters backed limits on data-center development in 40 of 41 local ballot measures, and newly elected governors’ pledges to pause projects could affect a substantial share of planned U.S. capacity. Though a nationwide halt appears unlikely, grid constraints, permitting delays and new requirements could reshape where and how facilities are built; some argue governments should expand power generation and grid capacity instead of restricting development. President Donald Trump’s opposition could impede federal legislation, while Democrats’ committee control could enable investigations and hearings; OpenAI has pledged to disclose water use and construction plans, conduct independent noise studies and avoid requiring nondisclosure agreements with public officials.