The Nasdaq Just Hit Correction Territory. History Says the Stock Market Will Do This Next (Hint: It May Stun You)

The Motley Fool · Trevor Jennewine · 2026-11-06 09:12 UTC

The Nasdaq closed in correction territory as post-midterm euphoria quickly gave way to anxiety about AI spending.

The U.S. stock market had a dismal October. The S&P 500 (^GSPC -4.36%) fell 0.9% in what has often been one of the strongest months of the year. And the Nasdaq Composite (^IXIC -5.52%) declined 5.3% as investors panicked about the sustainability of the artificial intelligence boom, representing its worst month since March 2025.

The losses have now spilled into November. On Thursday, Nov. 5, the S&P 500 and Nasdaq Composite fell 4.1% and 5.3%, respectively, erasing the post-midterm election gains and pushing the Nasdaq into correction territory. The sell-off was particularly brutal among technology companies, suggesting Wall Street is worried that Democratic victories in the midterms could slow AI spending.

However, there is a silver lining for patient investors. Historically, corrections have been an excellent time to put money into the stock market. Here are the important details.

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