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Friday, November 06, 2026
What’s happening: US stock indices fell on Thursday amid a selloff in semiconductor shares.
What happened: The S&P 500 notched its steepest decline since the tariff-driven selloff in April 2025 after recording sharp gains on Wednesday.
The selloff came on the heels of sweeping Democratic victories in Tuesday’s midterm elections, which triggered concerns over stricter AI regulations.
Why it matters: The Democrats gained control over the House of Representatives and the Senate following the US midterm elections on Tuesday.
Investors grew concerned about the victories paving the way for stricter oversight of data centres and high-powered computing infrastructure that fuel AI development.
Nvidia’s shares dipped 9%, while Broadcom’s stock shed more than 10%. Shares of Micron and AMD fell more than 17% on Thursday.
Investors shorted other mega-cap tech giants, reversing the previous day’s gains. Shares of Meta Platforms, Amazon and Alphabet settled lower on Thursday.
Shares of Tesla and SpaceX moved lower as Elon Musk spent a huge amount backing Republican candidates in the US midterm elections.
On the earnings front, Qualcomm’s stock fell 9.5% even after the chipmaker posted healthy results for the fourth quarter. Shares of Snap plunged 14% after the company reported mixed third-quarter results.
Data released on Thursday showed that initial jobless claims in the US declined by 6,000 to 189,000 in the latest week. The figure was better than market expectations of 196,000. The recent reading matched the 57-year low recorded in July, signalling continued resilience in the labour market.
The S&P 500 shed 4.36% to close at 7,353.73 on Thursday. The Dow Jones index declined 1,833.06 points, or 3.44%, to 51,523.06, while the Nasdaq 100 lost 6.36% to settle at 26,629.81.
Despite Thursday’s selloff, the S&P 500 remains higher by 7.4% in 2026. On Wednesday, the benchmark index recorded its biggest single-day percentage surge in three months.
What to watch: Investors will keep an eye on the performance of AI stocks.
Data on nonfarm payrolls (1730 UAE Time) and Michigan consumer sentiment (1900 UAE Time) from the US will be released on Friday. The US economy, which added 29,000 jobs in September, is expected to add 65,000 jobs in October. The US unemployment rate, which surged to 4.2% in September from 4.1% in the previous month, is expected to remain at 4.2% in October. The University of Michigan’s consumer sentiment index, which was revised higher to 48 in October, is expected to decline slightly to 47 in November.
Context: The GBP/USD fell this morning as investors digested the Bank of England’s latest interest rate decision.
Details: The sterling surged to its highest level since mid-September on Thursday, after the Bank of England hiked its key interest rate by 25 basis points to 4%. This was the BoE’s first rate hike in over three years.
Policymakers voted 8-1 in favour of the rake hike, with Catherine Mann pushing for a bigger 50 bps raise. Governor Andrew Bailey hinted that more interest rate hikes could follow unless the conflict in Iran ends and helps cool inflation.
The central bank also cautioned about the possibility of inflation reaching 4.9% in the second quarter of 2027.
The comments sparked speculations of further monetary policy tightening through the year to November 2027.
Data released on Thursday showed that the UK’s new car registrations rose 5.4% year-over-year to 152,730 units in October. This marked the 11th straight month of growth.
The S&P Global UK construction PMI declined to 43.6 in October from 46.1 in the previous month. The latest reading missed market estimates of 46.1 and was the sharpest contraction in construction activity since June.
Strength in the US dollar also weighed on the GBP/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained around 0.1% to 101.66.
The GBP/USD forex pair edged lower to 1.3448 this morning.
What to watch: Data on UK’s GDP growth rate, balance of trade and industrial production will be released on Wednesday. The UK economy which grew by 1.4% year-over-year in the second quarter is expected to expand by 1.7% in the third quarter.
Analysts expect industrial production in the UK to rise 0.2% in September following a 0.8% gain in August. The UK’s trade deficit, which shrank to £0.92 billion in August from £2.32 billion in the previous month, is expected to widen to £1.6 billion in September.
Other Markets: European indices closed mostly lower on Thursday, with the FTSE 100, DAX 40 and STOXX Europe 600 Index down by 0.43%, 0.43% and 0.38%, respectively, and the CAC 40 up by 0.34%.
US First Lady Melania Trump urged Russia and Ukraine to seek more “enduring” peace while hosting officials from both nations at the White House. The news sent the USD/RUB forex higher in forex trading this morning.
Sri Lanka’s tourist arrivals surged 2.1% year-over-year to 168,625 in October. This being the highest arrivals for October exerted pressure on the USD/LKR forex pair.
Eurozone’s producer prices surged by 2.5% in September, compared to a 2.0% gain in August. Producer prices recording the sharpest monthly gain since March sent the EUR/USD pair lower in forex trading this morning.
Taiwan’s annual inflation rate slowed to 2.33% in October from a 31-month high of 2.74% in the previous month, which exerted pressure on the USD/TWD forex pair.
Bank Negara Malaysia left its overnight policy rate unchanged at 2.75% for the eighth straight meeting, sending the USD/MYR pair higher in forex trading this morning.
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