The infrastructure supporting the artificial intelligence boom is facing a severe valuation crisis, with the firms responsible for building the industry’s physical footprint suffering the heaviest losses in a wide-reaching technology selloff. The market capitalization of data center construction companies fell by $4.2 trillion as investors retreated from the AI trade, a trend that saw semiconductor stocks slide 31% and the median stock on the market drop 11.7%.
The decline is led by Nvidia, which has lost more than $1.8 trillion in market value since its peak on Oct 6, with its shares falling 57%. This contraction is estimated to have erased roughly $500 billion in household wealth, and it coincides with a period where the S&P 500 index has decoupled from the performance of its average constituent more than at any time since 1990. Despite these losses, the S&P 500 and Nasdaq both managed to post winning weeks as of Nov 13.
