Dan Ives, technology analyst and Yorkville Ives & Co. partner and senior managing director, said Democratic control of Congress could slow the U.S. artificial-intelligence (AI) infrastructure buildout, estimating that 10% of planned data centers “will not happen now.”
Ives Sees Slower Data Center Expansion
Ives said Wednesday that the “Democratic blue tidal wave across the Senate and House” represented a “seismic shift” for the AI infrastructure story.
He said the election result “will have a negative impact on the pace of the AI Revolution buildout in the US over the next few years” and could slow the pace of the planned 800 to 1,000 data centers across the country.
“We estimate 10% of datacenters will not happen now,” Ives wrote on X, adding that some investors may favor a slower construction pace while others could view it as additional risk.
Democrats secured control of both the House and Senate in Tuesday’s midterm elections, according to the Associated Press. The party also scored gubernatorial victories, including Gina Hinojosa’s defeat of Republican Gov. Greg Abbott in Texas.
Thorne Rejects End Of AI Trade, Schiff Points To Economy
James E. Thorne, chief market strategist at Wellington-Altus, pushed back against expectations that slower construction would end the AI investment cycle.
“Expect the doomer narrative to shift: America won’t build the data centers, and the AI trade is over. Wrong on both counts,” Thorne wrote on X.
He added that slowing data-center construction and ending the Iran war would be positive for bringing inflation down.
Economist Peter Schiff, meanwhile, characterized the Democratic victory as a judgment on President Donald Trump’s economic record.
Schiff called the election a “referendum on Trump,” saying voters experienced economic hardship while Trump had been “boasting of a booming economy.”
Gerstner Also Flags Capacity Risk
The comments followed a warning from Altimeter Capital CEO Brad Gerstner, who said on the All-In Podcast election-night livestream that 10 to 15 gigawatts of expected data-center capacity could fail to come online.
“I think it’s going to be really challenging for the AI infra,” Gerstner said.
Still, Gerstner said he did not expect America to retreat from AI, calling it a global race.
How Has the Stock Market Performed?
The S&P 500 index has advanced 10.36% year-to-date. Similarly, the Nasdaq Composite index was up 9.19%, and the Dow Jones gained 7.04% YTD.
On Tuesday, the SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 and Nasdaq-100, respectively, closed mixed. SPY rose 0.30% to $754.35, while QQQ advanced 0.62% to $685.28. Meanwhile, the Dow tracker, State Street SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA), ended 0.44% lower at $517.06.
In premarket trading on Wednesday, SPY was up 1.12%, QQQ advanced 0.35%, and DIA rose 2.10%.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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