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Morning Edition · Saturday, November 7, 2026Published at 12:12 AM EST · New York
Voters Reject Data Centres in 40 of 41 Ballot Measures as an AI Sell-Off Sends Japan's Nikkei Into a Bear Market
The Nikkei fell 6% on Friday to 57,410.91, a day after the Nasdaq dropped 6.4%, as investors questioned whether artificial intelligence spending will survive Democratic control of Congress and local opposition.
US voters rejected data-centre development in all but one of the 41 local measures on the issue in Tuesday's midterm elections, Al Jazeera reported. Other tallies use different counts but show the same result. Stateline found that the only win for supporters of construction came in Harwood, North Dakota. 404 Media's count, cited by AI Weekly, said six cities voted to ban new data centres outright.
Equity markets have connected the votes to the national result. The Economist reports that investors worry Democratic control of Congress will slow the artificial intelligence (AI) boom. On Thursday the Nasdaq fell 6.4%, its worst day since the April 2025 trade-war sell-off, Morningstar reported. It recovered 1.1% on Friday but still lost 3.4% for the week.
The selling hit Asian suppliers hardest. Japan's Nikkei 225 closed down about 6% at 57,410.91 on Friday, more than 20% below its June peak, which put it in a technical bear market, Reuters reported via Yahoo Finance. South Korea's KOSPI fell 6.02%. Chip and component makers such as Advantest, Kioxia and Rohm led the decline, and Bloomberg said traders questioned whether AI infrastructure spending will earn enough to justify it.
The opposition is not only American. Activists stormed the site of a planned Microsoft data centre in Amsterdam, and The Nation Thailand reported that protests over data-centre expansion and its environmental costs are spreading across Europe. The objections are similar on both continents: electricity prices, water use and land.
Part of a tracked trend
AI Spending Meets Funding Limits
As AI capital spending shifts from internal cash flow to debt and private funding, each new spending increase will be answered with lower supplier valuations and higher financing costs until spending growth slows to what measured returns can support.
Veracity: Corroborated
76/100- If true, who benefits
Residents and ratepayers worried about power and water costs gain bargaining power over developers, states with surplus power gain if projects move to them, and investors betting against Asian chip suppliers profit from the sell-off.
- The nuance
CNBC counted 41 measures, but other trackers use different counts. Harwood's lone pro-construction result came from voters rejecting a review requirement. The link between local zoning votes and the Nasdaq's 6.4% fall is an attribution that investors and commentators make, not a demonstrated cause.
An open-source-intelligence read of how likely this story is true with its real nuance, not a judgment of any outlet. It assesses the claim, weighing independent and adversarial reporting. How we label confidence.
What this means
Two constraints now act on the AI build-out at the same time. Local permitting limits where facilities can be built and how much power they can draw. Rising US rates raise the cost of the debt and private credit that increasingly fund the spending. Component suppliers in Japan and Korea carry the most operating leverage, because a small cut in hyperscaler orders produces a large fall in their earnings. The consensus reads the ballot results as a national brake. A more likely outcome is that spending moves to jurisdictions that still welcome it, such as Gulf states, parts of Asia and US states with surplus power, while the rate path does more of the slowing. The precedent is the telecom capital-spending boom of 1999 and 2000. Equipment suppliers fell first and furthest, well before carriers cut their budgets. The desk's read is that over the next few months hyperscalers keep their spending guidance, while supplier valuations stay under pressure and financing spreads widen. Nvidia's results on November 17 are the next test. Strong Nvidia guidance alongside narrower spreads on technology debt would prove this read wrong.
Synthesized from: Al Jazeera · The Economist · Al Jazeera (video) · The Nation Thailand
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Comments
1Nov 7, 5:12 AM · edited
Bear market status at 57,410.91 implies a prior Nikkei peak of at least about 71,760, so the index would need a gain of 25% or more to recover it.