Chinese stocks rose on Thursday while an AI selloff wiped around $3 trillion off Wall Street, yet the US remains the firm favourite to win the AI arms race, affirms the CEO of deVere Group, one of the world’s largest independent financial advisory organisations.
The comments from Nigel Green come as the Nasdaq dropped 5.5%, its worst day since April 2025, after Democrats swept the key data centre states in Tuesday’s midterms.
US stocks lost roughly $3 trillion in market value, and the world’s biggest chipmaker, Nvidia, alone lost almost $450 billion.
The main US-listed China funds rose between 1% and 1.8%.
He says: “Investors sold American chipmakers, but they didn’t sell AI.
“Some of that money moved to China because Chinese tech is cheaper and it was holding up. It’s a hedge against delays in America.
“China hasn’t overtaken the US, and America still leads the arms race by a distance.”
Democrats won governor and Senate races in Texas and Ohio and the governor’s race in Georgia, the states with the biggest data centre plans. Voters also backed restrictions on data centres in 40 of 41 local ballot measures across 10 states.
“Voters in these states don’t want data centres on their doorstep, and the new governors were elected partly on that,” explains Nigel Green.
“Projects there will likely take longer and cost more. The chips and the software keep improving regardless.”
China has been gaining ground with global investors. The Hang Seng Index finished 2025 up 28%, and American investors bought $15 billion of Hong Kong and mainland stocks last year.
The leading China internet fund is still around 38% below its November peak, however.
“China can approve a data centre and the power plant to run it far faster than an American state can,” says the deVere chief executive.
“With Chinese tech stocks priced well below their US rivals, I believe more global money is likely to head there.”
The deVere CEO is clear about the limits.
“China comes with risks the US doesn’t have. Beijing can change the rules for a company overnight, and Washington still controls access to the most advanced chips. Investors buying the rally need to price that in.”
Pressure on AI stocks was building well before the vote. The biggest hyperscalers are each planning to spend more than $100 billion a year, borrowing costs are rising, and three of them have now gone free cash flow negative.
“The worries about debt and spending were already there,” Nigel Green says. “The election gave investors the excuse to sell.”
He points to early signs the political fight will end in a deal. At least one newly elected governor has already told the industry he wants to keep its investment and jobs.
“The US still makes the best chips and builds the leading models,” he notes.
“Governors want the jobs and the tax revenue. I think most of these projects go ahead in the end, after a fight over electricity and water costs.”
He believes the selloff marks the start of a tougher, more demanding phase in the arms race.
“Markets now want proof: secured power, approved sites and revenue coming in. The US is best placed to deliver it.
“China’s rise means US firms will have to move faster, and that competition is likely to speed up the whole industry.”
