US stocks had a rough few days after the country’s midterm elections stirred up fresh worries about AI. That’s nothing new for markets that have been centred on AI, something our CIO has covered. So while Wall Street catches its breath, it’s worth checking in on the economy underneath, and the latest numbers suggest it’s in good health.
What's going on here?
Democrats won big in the midterms, and many of them had campaigned on slowing the spread of AI data centres, which voters worry will drain local water and power. Chipmakers took the hardest hit, though the S&P 500 has since been clawing back its losses. On Monday, the index had its best day since April.
Nvidia, the chipmaker at the heart of the AI boom, has had a harder time bouncing back. After the elections, Nvidia fell 9.3% in a single day, more than twice the S&P 500’s drop. Over the whole year, the gap is even wider: as of last week, Nvidia’s shares were down for 2026, while the S&P 500 was up about 7.4%. That’s the advantage of investing broadly: the S&P 500 spreads your money across around 500 companies in every corner of the economy, so when one stumbles, others pick up the slack.
The US economy, meanwhile, has been holding up just fine. Employers added 165,000 jobs in October, far more than the 65,000 economists expected, and the unemployment rate edged down to 4.1%. The bigger picture looks solid too: the economy grew at a 3.4% annualised pace in the third quarter, with consumer spending up 3.8%.
What's the takeaway here?
Headlines can knock markets around, but over the long run stock prices tend to follow company profits more closely. On that front, a growing economy is giving companies plenty to work with. A diversified portfolio is how you share in that growth without relying on any one stock to get you there, and it makes a week of AI headlines just one part of a much bigger picture.
(For a portfolio that’s built around a risk level you’re comfortable with, see General Investing.)
In Other News: Indian stocks are having their best run since 2021
The Nifty 50, India’s benchmark stock index, has climbed nearly 10% so far in November, with a seven-session winning streak that gave it its best week since February 2021. Overseas investors have poured nearly US$6 billion into Indian shares this month, their biggest monthly purchase since September 2024 and a big turnaround after two years of net selling.
Cheaper oil and a cooling AI trade have both worked in India’s favour. Brent crude has slipped to around US$93, a relief for the world’s third-largest energy importer, while India’s relatively small AI footprint has now become a natural counterweight for investors heavy on AI.
That’s a big shift from just a few weeks ago. By late September, the Nifty was down nearly 13% for the year as global funds poured into more AI-heavy markets. It was local investors who kept the market from sliding further, putting into Indian mutual funds more than twice as much money over the past year as foreigners took out.
A turn like this shows why staying invested matters. According to a 2025 study, holding the Nifty 50 over 20 years would net about twice as much wealth as missing just 10 of its best days. And most of those days came within two weeks of the market’s worst. Our own analysis of the S&P 500 agrees: since 1996, even buying at every market peak beats sitting in cash. Selling in a slump means being right twice, on the way out and the way back in. Staying invested means taking that guesswork away.
(For expert-vetted ETFs that invest in India and more, see Flexible Portfolios.)
Past performance is not an indicator of future returns. These articles were written in collaboration with Finimize.
