Michael Dell's wealth drops by $10 billion amid concerns over data centre regulations

Shares of Dell Technologies have witnessed a significant decline due to concerns regarding new data centre regulations following the US midterm elections. According to a report by The Times of India, this slump resulted in a loss of over $10 billion in the wealth of the company's CEO, Michael Dell, within just a few hours. This marks the largest single-day drop in his net worth.

On the other hand, Mark Zuckerberg's wealth has increased. As per The Times of India, Meta's shares saw a surge due to positive investor sentiment. These divergent reactions in technology stocks indicate that recent political developments have had varying impacts on market dynamics.

Meanwhile, the South Korean market also experienced a steep decline. According to a Yonhap report, Seoul's shares fell by more than 5 per cent on Thursday. Apprehensions have arisen that strict regulations will be imposed on Artificial Intelligence (AI) investments following the Democratic Party's major victory in the US midterm elections. Consequently, the benchmark Korea Composite Stock Price Index (KOSPI) closed at 5,383.80, down by 300 points or 5.28 per cent.

According to Yonhap, due to this decline, the bourse operator activated a sell-side sidecar at 10:16 am, suspending program trading for five minutes. A total of 256.8 million shares were traded in the market, valued at 22.6 trillion won ($16.8 billion). Foreign investors sold shares worth 3.39 trillion won, while institutions and individuals bought shares worth 841.8 billion won and 2.28 trillion won, respectively.

Seoul's tech giants were heavily impacted. Samsung Electronics fell 7.57 per cent to 201,500 won and SK Hynix dropped 9.46 per cent to 1.26 million won. Hanmi Semiconductor closed at 169,100 won, down 9.13 per cent, and Samsung Electro-Mechanics fell 15.34 per cent to 944,000 won. Kim Seok-hwan, an analyst at Mirae Asset Securities, stated that the Democrats' victory has dragged down shares in the semiconductor value chain.

In other sectors, SK Innovation closed at 114,200 won, down 7.68 per cent, and Hanwha Aerospace fell 7.48 per cent to 680,000 won. However, Hyundai Motor rose 3.53 per cent to 293,500 won and Kia increased 5.22 per cent to 100,800 won. Naver closed up 8.26 per cent at 184,900 won. The local currency stood at 1,342.1 won against the US dollar.

According to a Business Standard report, small-cap stocks linked to the US data-centre and AI investment boom initially saw large profits, but questions have now arisen regarding the sustainability of this rally due to the global technology sell-off and excessive valuations.