Global financial markets saw sharp movements on Thursday as oil prices extended their steep decline following the Democrats’ sweeping victory in the US midterm elections, while semiconductor and artificial intelligence stocks came under pressure amid concerns over tighter scrutiny of data centre development.
Brent crude fell below $100 a barrel after plunging nearly 9% overnight, extending its weekly decline to approximately 20% as investors reassessed the outlook for the Middle East conflict and global energy supplies. The international oil benchmark subsequently traded around $94 a barrel, marking a substantial retreat from the elevated prices seen during October.
If sustained through Friday’s close, the decline would represent oil’s largest weekly fall since April 2020, when the collapse in demand during the Covid-19 pandemic briefly pushed US crude futures into negative territory. The sell-off reflects expectations that Democratic control of Congress could increase political pressure on President Donald Trump’s administration to pursue a negotiated settlement with Iran.
Lower oil prices supported government bonds and weakened the US dollar, as investors assessed the potential for easing inflationary pressures.
The yield on the benchmark US 10-year Treasury fell to 4.85%, its lowest level in two months, as bond prices strengthened.
Meanwhile, the dollar weakened to a one-month low against the euro, with the European currency rising to approximately $1.1273.
The decline in energy prices and bond yields provided support for broader equity markets, with the S&P 500 closing 1.6% higher on Wednesday and European shares reaching a two-month high.
Technology stocks, however, faced renewed selling pressure as investors considered the potential impact of greater political scrutiny of artificial intelligence infrastructure.
Democratic candidates who had campaigned on restricting or temporarily halting data centre construction secured notable victories in Texas and Georgia, raising questions about future planning approvals and electricity infrastructure investment.
The election results have intensified attention on the growing power requirements of AI data centres, particularly as major technology companies commit substantial capital to expanding computing capacity.
Nasdaq futures fell approximately 1% ahead of Thursday’s US trading session, indicating continued weakness among technology and semiconductor companies despite gains in broader equity markets.
Asian markets experienced particularly sharp declines in chip-related stocks.
South Korea’s Kospi plunged nearly 6%, approaching a seven-month low as semiconductor companies came under sustained selling pressure.
Taiwan’s benchmark index fell more than 3%, leaving it on course for a weekly decline of approximately 8%, potentially its worst performance since April 2025.
Japan’s Nikkei 225 declined 2%, weighed down by technology equipment suppliers, although the broader Topix index gained 0.8%.
The contrasting performance highlighted the divergence between companies directly exposed to AI infrastructure spending and businesses benefiting from lower energy costs and improved financial conditions.
Precious metals strengthened amid the weaker dollar and falling US bond yields, with gold trading around $4,144 an ounce and silver near $53.
Copper was quoted at approximately $6.41 per pound, as investors continued assessing the outlook for industrial demand and global economic growth.
In London, attention is also focused on Thursday’s Bank of England interest rate decision at 12pm GMT, with markets expecting a 25-basis-point increase in Bank Rate to 4% from 3.75%.
The decision comes as UK policymakers balance persistent domestic inflation against the potential relief provided by falling global oil prices.
