2026 AI spending projected at $1 trillion... US data center proposed capacity 400GW

The Nasdaq 100 fell 6.4% and the S&P 500 dropped 4.4% on the 5th, while the Philadelphia Semiconductor Index slid 12.3%, extending its decline since June to 38.3%. UBS attributed the selloff less to deteriorating AI demand forecasts than to uncertainty over data center construction costs and timelines, arguing the AI investment cycle has not necessarily reversed. The pullback unwound a relief rally that followed the U.S. midterm elections, as investors reassessed how Democratic gains in state and local races could affect data center development. UBS projects AI spending will reach $1 trillion in 2026, with proposed U.S. data center capacity at 400GW. The debate now centers not only on AI usage demand but on where and how quickly data centers can be built.