Nasdaq Enters Correction, AI Trade Unravels

This looks less like an AI collapse than a valuation reset: markets are finally demanding evidence that infrastructure spending becomes durable profit.

• –Midterm results raised fears of stricter data-center permitting, power, water, labor, and tax rules.
• –Hyperscaler earnings failed to reassure investors that AI capital expenditure is translating into proportional returns.
• –Highly leveraged neoclouds and infrastructure suppliers face the most immediate risk if construction slows.
• –A measured capex slowdown could ultimately extend the AI cycle by reducing overheating and debt pressure.
• –Developers should expect tighter funding and greater scrutiny of AI projects’ measurable economic value.