Global tech stocks wobble over AI regulation fears after midterms | First Thing

Good morning. Stock markets around the world have fallen sharply as a rout in US tech stocks spread across the Atlantic after the Democrats’ midterms victory led to fears of a slowdown in the AI industry. A sell-off on Wall Street on Thursday was followed by sharp falls in Asian stock markets on Friday morning. The dip in investor sentiment has also reached London.

Susannah Streeter, the chief investment strategist at Wealth Club, said: “The tech sell-off has intensified. Big worries are colliding – the build-out of datacenters looks set to slow, which risks shredding the spending spree underpinning the boom, right at the time that investors have become super nervous about returns on this massive investment.”

• What happened to the Nasdaq? The Nasdaq share index had its worst day in 19 months after slumping 5.5% on Thursday amid growing signs that the AI industry will face tougher regulation.

Isaac Herzog yet to decide who should form Israeli government after election deadlock

Gadi Eisenkot, the main rival to Benjamin Netanyahu, secured endorsements on Thursday from a majority of lawmakers to try to form a government but Israel’s president, Isaac Herzog, said it was still unclear who could break the deadlock and that he would decide on Sunday which of the two men should try first.

Trump signs proclamation to try to prevent changes to gold-covered Oval Office

Reeling from the midterm results, the US president has attempted to secure the future of his gaudy redecorations at the White House by declaring his design of the Oval Office and Cabinet Room national monuments that should be preserved. Barack Obama recently said the redecoration looked like “Saddam Hussein opened a The Cheesecake Factory” but Trump claimed his proclamation would “make them into a landmark for the ages”.

• What is happening with Trump’s “triumphal arch” project? A federal judge has halted construction work on the towering arch for 14 days, a significant setback for one of the president’s most prominent projects in his vision to remake Washington.

Google, Meta and TikTok sue California to block law protecting children from addiction risk

Google, Meta and TikTok have sued California to block enforcement of ⁠a new state law intended ⁠to limit the risk ​of children becoming addicted to social media platforms. The law, known as Assembly Bill 1709, prohibits such platforms from offering children “psychologically exploitative features”. The office of the California attorney general said it was reviewing the lawsuits. “Our office is committed to defending California’s commonsense laws to protect kids online,” it added.

Paraguay’s president quits after millions of people’s savings frozen in bank crisis

Paraguay’s rightwing president, Santiago Peña, resigned on Thursday after a political and financial crisis collapsed the South American country’s banking system. At the crisis’s centre is Ueno Bank, an obscure lender that expanded rapidly under Peña to claim 60% of Paraguay’s adult population as clients. Last Monday, the central bank ordered its resolution over insolvency, freezing 3m accounts – prompting executive arrests and massive street protests.

In other news …

• The Hollywood actor turned online influencer Russell Brand faces a “significant custodial term” after being convicted of raping a woman and assaulting three others in London. He will be sentenced on Monday, and is under investigation for two further rape allegations.

• The billionaire Leon Black has filed a defamation lawsuit against the California congressman Robert Garcia, accusing the lawmaker of making false statements about his ties to Jeffrey Epstein.

• The Democratic socialist Nithya Raman has won the Los Angeles mayoral race over the incumbent, Karen Bass.

• Gavin Newsom, California’s governor, commuted the death sentences of more than 500 people on the state’s death row on Thursday.

• The Amtrak workers’ union has denounced a plan to let passengers bring guns on trains as “sheer lunacy”.

• Salon, one of the early internet’s pioneering publications, is closing after more than three decades.

Stat of the day: Trump has taken 500 actions to weaken cancer protections

A Natural Resources Defense Council report says that federal rules changes will increase the public’s exposure to carcinogens after the Trump administration has taken more than 500 actions to systematically dismantle protections.

Culture Pick: I Play Rocky review – Anthony Ippolito adds knockout sweetness to the story of Stallone’s Hollywood triumph

Peter Bradshaw writes that by portraying the humour, passion and grit that took Sylvester Stallone from bit parts to Oscar glory, this making-of tale is even more mythic than the original movie.

Don’t miss this: ‘Every day, someone loses a hand or a leg’ – the brutal reality of India’s textile recycling industry

Anjul Behal reports from Panipat, where 1m tons of used clothing a year are turned into products for global brands, but dangerous machinery and few safeguards mean life-changing injuries are common among workers.

… or this: ‘Sick to my stomach’ – trans Americans on politicians who spent $183m attacking them for votes

Republicans spent big on midterms ads about transgender issues – and some Democratic candidates parroted anti-trans messaging, too. Alaina Demopoulos speaks to some of the people on the receiving end of that vitriol.

Climate check: World’s wettest rainstorms are getting wetter, affecting flood and drought risk

The world’s wettest rainstorms produce about half of the global annual rainfall. Now a study shows that these intense downpours have become shorter in duration and fewer in number, compressing the same amount of rain into quicker and more extreme events, with implications for flood and drought risk.

Last Thing: Peru airport officials discover 3,000 tarantulas smuggled inside dirty socks

I will spare you the pictures in case you have arachnophobia, but more than 3,000 tarantulas were seized at an airport in Lima. The German-bound spiders were hidden inside dirty socks, and were spotted after agents noticed some unusual wriggling inside the luggage during a routine customs inspection. There is a video, if you can bear it.

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