Nasdaq-100 futures fell 0.8% overnight, more than double the decline in Dow Jones Industrial Average futures, after Democrats won the Texas governorship in the 2026 midterm elections, CNBC reported. The State Street Technology Select Sector SPDR ETF (XLK) was down 2% on the Robinhood trading platform.
CoreWeave, a high-risk neocloud that uses borrowed money to build data centers, dropped 7% on Robinhood. Elon Musk’s SpaceX, headquartered in Texas, fell 6%. Nebius Group lost 4%, and Oracle slipped 4%.
The Texas Governor Race That Moved Markets
Democrat Gina Hinojosa was the projected winner over incumbent Republican Gov. Greg Abbott, according to the Associated Press. Markets had already been pricing in a Democratic House takeover and a possible Senate flip, but the Texas mansion going to Democrats appeared to be the biggest blow to tech shares.
“The one thing that could really end up moving stuff though would be if Abbott were to lose Texas,” said Scott Ladner, chief investment officer of Horizon Investments, earlier Tuesday as results rolled in. “Because there is a legitimate question about where do you build these data centers?”
Ladner added: “Texas is a fertile ground for that. And if he were to lose, I think that fertile ground is largely barren.”
Hinojosa has been outspoken in support of a moratorium on AI data centers. According to Wells Fargo, 27% of planned data center gigawatts in the United States is in Texas.
Which AI Stocks Fell Hardest Overnight
| Asset | Overnight move |
|---|---|
| CoreWeave | Down 7% |
| SpaceX | Down 6% |
| Nebius Group | Down 4% |
| Oracle | Down 4% |
| XLK tech ETF | Down 2% |
| Nasdaq-100 futures | Down 0.8% |
Why Data Centers Became a Political Flashpoint
Democrats were also projected to win or retain the governorships in Georgia, Pennsylvania and Ohio — three more key data center states. Georgia represents 7% of all planned U.S. data center gigawatts, while Ohio and Pennsylvania account for 5% apiece, according to Wells Fargo estimates.
“Data centers went from being a popular economic development tool in 2024 and 2025 to something of a pariah by the time the midterm campaigns gathered steam,” wrote the Washington policy team at Optimal Advisory this week. “The midterms are likely to send a message to local and state officials that there is a political upside to blocking, delaying and/or raising the cost of data centers.”
Did you know? Texas alone holds 27% of all planned U.S. data center gigawatts, per Wells Fargo.
What Strategists Warned Before the Vote
Ohsung Kwon, Wells Fargo’s chief equity strategist, warned in a report that the equity market reaction from the midterms mostly depended on the Texas governor’s race, and that a Democratic win there could be a “left-tail event” for the AI trade.
The Texas result adds to pressure already on the AI trade: the Nasdaq-100 index fell into correction territory to end October as concerns mounted that data center spending by hyperscalers and private AI companies OpenAI and Anthropic was slowing.
Michael Hartnett of Bank of America had warned earlier this year that Democrats winning the Senate combined with taking the Texas governorship could lead to a “big slump” in stocks of more than 10% into year-end.
Questions Investors Are Asking After the Texas Result
Why did the Texas governor’s race matter so much for AI stocks?
Because 27% of planned data center gigawatts is in Texas, according to Wells Fargo, and projected winner Gina Hinojosa has been outspoken in her support of a moratorium on AI data centers. Scott Ladner of Horizon Investments said an Abbott loss would make that “fertile ground” for data center construction “largely barren.”
Which AI-related shares fell the most overnight?
CoreWeave dropped 7% on Robinhood, SpaceX fell 6%, and both Nebius Group and Oracle lost 4%, while the XLK technology ETF was down 2% and Nasdaq-100 futures fell 0.8% — more than double the Dow futures decline.
What did analysts warn could happen if Democrats took Texas and the Senate?
Bank of America strategist Michael Hartnett warned earlier this year of a “big slump” in stocks of more than 10% into year-end, while Wells Fargo’s Ohsung Kwon called a Democratic Texas win a potential “left-tail event” for the AI trade.
The Nasdaq-100 had already entered correction territory at the end of October, a decline of more than 10% from its recent peak, before the election results added overnight pressure.
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