Why Is The Stock Market Crashing Today?

Published by

Anjali Belgaumkar

November 5, 2026

Hand holding torn financial chart split between green growth and red crash

Thursday’s sharp stock market drop has more to do with AI regulation fears and leverage than the midterm results themselves, according to The Kobeissi Letter. The research firm said the Democratic sweep was already largely priced in, so investors should ask what changed in the past 24 hours. Its answer is growing concern that Democratic lawmakers could push for strict limits on advanced AI, with some calling for a ban on artificial superintelligence. Kobeissi said an outright ban will not happen, since it would hand China the lead in the global AI race. It described the selloff as more technical than fundamental, driven by a sudden change in mood meeting heavy leverage, which may have forced large institutions to sell. Founder Adam Kobeissi said the S&P 500 is still up 9% this year and 85% since the AI boom began, and urged investors to stay calm.

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