History has shown that the first signs of crisis are seen in the stock market itself, and exactly the same is happening with the American stock market. Heavy selling is being seen. On Thursday, November 6, a huge decline was seen in the American stock market. The S&P 500 lost about 1.1%. The Nasdaq index fell 2%, and the Dow Jones Industrial Average also declined about 0.8%. Earlier, on November 5, a decline was recorded in the US stock market.
If we look at the reasons for this decline, three main reasons emerge.
1. Bad condition of AI stocks: It is being said that the bubble related to Artificial Intelligence (AI) is now bursting. Investors are becoming worried about AI companies. In such a situation, the question arises: Why did the word “bubble” suddenly start being used in the context of AI?
Big tech companies, especially AI-themed stocks, are experiencing high valuations, and investors are concerned about their ability to deliver returns in the future. AI-related stocks have seen a meteoric rise over the past two years, but the growth has not been proportionate.
Investors fear that some big tech companies are not growing as fast as they have been, meaning valuations are overstated. Therefore, even though some AI-related companies have delivered strong results, their shares have seen steep declines.
2. Large-scale layoffs in American companies: The threat of recession in the American economy is further increasing the employment crisis. In October 2025 alone, about 1.53 crore people in the US lost their jobs. This is the largest figure of job cuts in any October month in the last 20 years. So far, about 11 million jobs have been projected to be lost through 2025, an increase of nearly 65% from a year ago.
These layoffs are not limited to just one or two sectors; Many industries are being affected, including technology, retail, services sector, warehousing and logistics. Investors are no longer trusting the AI topic much, which is why this sector is being significantly impacted. Rising costs and increasing economic uncertainty are prompting companies to rapidly implement cost-cutting measures. With the advent of AI, many jobs are now being replaced by automation/AI.
3. Pressure on the economy: The possibility of increasing interest rates has increased pressure on the US economy. The US debt has exceeded $38 trillion, reaching approximately 324% of GDP. If the United States does not solve this problem in time, not only economic, but also political and social challenges may emerge rapidly. The fear of rising inflation is also increasing.