'They're shooting the generals': AI trade stocks drop as hedge funds rush to protect 2026 gains
AI trade stocks tumbled on November 5, 2026, sinking the Nasdaq 5% and prompting Wall Street warnings of an institutional shakeout as hedge funds rushed to lock in 2026 gains: Nvidia was down 15% over the month, Lam Research 36%, and Micron sank 17% on the day while still up roughly 140% year to date. Nomura strategist Charlie McElligott called the unwind of popular thematic stocks "wildly acute," saying the catalyst is profit-taking rather than deteriorating fundamentals, while analysts flagged worries over AI data center build-outs after a Democratic sweep.
