The stock market recovered some ground on Friday, November 6, after a sharp artificial-intelligence-led selloff pushed the Nasdaq Composite into correction territory and wiped out much of the week’s gains.
The Nasdaq rose 1.09 per cent to close at 24,579.42, while the S&P 500 gained 0.31 per cent to finish at 7,376.86.
The Dow Jones Industrial Average moved in the opposite direction, falling 237.33 points, or 0.46 per cent, to close at 51,285.73.
Despite Friday’s recovery, all three major U.S. indexes ended the week lower.
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Stock market rebound follows severe AI selloff
Friday’s gains came one session after Wall Street suffered its worst day of the week.
On Thursday, November 5, the S&P 500 dropped 4.36 per cent, the Nasdaq plunged 5.52 per cent and the Dow fell 3.44 per cent, in a session detailed in a sharp market reversal.
The Nasdaq’s Thursday decline pushed the technology-heavy index more than 10 per cent below its October 6 record closing level of 27,599.89, meeting the commonly used definition of a market correction.
Friday’s rebound was concentrated in technology and semiconductor shares, which had absorbed some of the heaviest selling during the previous session.
Nvidia gained nearly 3 per cent, while other major chipmakers, including AMD, Intel and Micron Technology, also advanced.
Tesla and SpaceX-linked shares recovered after falling earlier in the week, adding to the broader bounce in the technology trade.
Why investors are questioning AI spending
The selloff has focused attention on whether the enormous spending plans supporting the AI boom will generate sufficient returns.
Technology companies and cloud providers have committed billions of dollars to data centres, advanced chips, electricity capacity and related infrastructure.
Investors are increasingly asking whether that spending can continue at its current pace without placing pressure on cash flow, borrowing costs and future profits.
Concerns about potential changes to data-centre policy also contributed to the market’s volatility after Democrats won a series of victories in the U.S. midterm elections.
Those results raised questions about whether new state or federal rules could slow data-centre construction, increase environmental requirements or place additional limits on artificial-intelligence companies.
The election outcome does not by itself establish that new restrictions will be enacted.
However, the market reaction showed how sensitive AI-related shares have become to changes in the expected regulatory and investment environment.
Jobs report adds support for broader economy
A stronger-than-expected U.S. employment report provided another source of support for stocks on Friday.
The U.S. Bureau of Labor Statistics reported that non-farm payroll employment rose by 165,000 in October and that the unemployment rate remained at 4.1 per cent.
Employment gains were recorded in professional and business services, health care, transportation and warehousing.
Average hourly earnings for private-sector employees increased 0.4 per cent during the month and were up 3.1 per cent from a year earlier.
The report pointed to continued economic momentum, although stronger employment can also complicate expectations for faster interest-rate cuts if inflation remains persistent.
For Friday’s trading session, the data helped reinforce the view that the broader U.S. economy remains more resilient than the sharp losses in AI shares might suggest.
What the correction means for investors
A correction does not automatically mean that a bear market or recession is beginning.
It describes a decline of at least 10 per cent from a recent high and can occur during a longer-term period of economic growth.
Still, the speed of this week’s moves highlights the risks of concentrating a portfolio in a small group of highly valued technology companies.
Canadian investors with U.S. equity exposure may also see the impact through exchange-traded funds, pension holdings and individual shares listed on American exchanges.
Currency movements between the Canadian and U.S. dollars can increase or reduce the effect of changes in U.S. share prices for Canadian investors.
The immediate question for markets is whether Friday’s recovery marks the start of a more durable stabilization or only a temporary pause after forced selling.
Investors will be watching upcoming corporate results, company guidance on capital spending and any further policy signals related to AI infrastructure.
Until those questions become clearer, large daily swings in technology and semiconductor stocks are likely to remain a central feature of the market.
Frequently Asked Questions
What happened to the stock market on November 6, 2026?
The Nasdaq Composite rose 1.09 per cent and the S&P 500 gained 0.31 per cent, while the Dow Jones Industrial Average fell 0.46 per cent.
Why did AI stocks sell off this week?
Investors questioned whether the rapid growth in AI infrastructure spending can produce sufficient returns and reacted to concerns that new policies could slow data-centre construction.
Is the Nasdaq officially in a correction?
Yes. After Thursday’s decline, the Nasdaq fell more than 10 per cent from its October 6 record closing level, meeting the standard definition of a correction.
Did the U.S. jobs report affect Friday’s market?
The report showed 165,000 jobs were added in October and unemployment remained at 4.1 per cent, supporting the view that the broader economy remained resilient.
What should Canadian investors watch next?
Investors should monitor corporate earnings, AI-related capital-spending plans, policy developments affecting data centres, interest-rate expectations and movements in the Canadian dollar.
Fact-Checked: Key index levels, market movements and employment figures were checked against Nasdaq, Federal Reserve economic data and the U.S. Bureau of Labor Statistics.
Disclaimer: This article is for news and information purposes only and is not financial, investment or trading advice.