The AI sell-off compared to well-known stock market crashes
kadoa.com92 points76 comments
The analysis places the market decline labeled the “AI sell-off,” measured through November 6, 2026, against earlier US stock-market crashes. The S&P 500 stood 5.7% below its October 6 record after 23 trading days; its worst day in the period was a 4.4% drop on November 5. Such a fall is modest historically: since 1928, 56 S&P 500 declines reached at least 6%, and only 16 later exceeded 15%. By contrast, technology stocks have fallen much further. The Nasdaq was down 10.9%, while the PHLX semiconductor index had dropped 35.8% from its June high - about the same depth as its decline during Covid.
Past episodes show that losses and recoveries vary widely across markets. The S&P 500 fell 86% in the Great Depression, 57% in the 2008 crisis, and 49% during the dot-com bust. It took 7.2 years to regain its dot-com peak; the Nasdaq took 15.1 years, and chip stocks 17.7. Recent downturns recovered faster: the S&P 500 regained its 2022 high in two years and its April 2025 high in four months. The current slide has not yet recovered, and its eventual depth and duration remain unknown. Recovery comparisons use price indexes without dividends, so reinvested dividends would generally shorten the wait for investors.
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