Texas governor-elect pledges limits on data centers as tech stocks fall
Hinojosa would halt new data-center projects until protections exist, and the Nasdaq Composite lost 5.52 percent in the same session.
Texas Governor-elect Gina Hinojosa said on Thursday she would move to limit data-center development in the state, a pledge made as US technology shares tumbled, Turkey's state-run news agency Anadolu Agency reported.
The Democrat told CNN that Texas will remain open to business, but investments must benefit the people who live there.
Hinojosa argued that data centers have spread into mostly rural communities without enough safeguards, leaving residents exposed.
She said she would propose legislation to protect Texans and pause new data-center projects until those protections are in place.
Hinojosa said she does not oppose the industry outright, but objects to how data centers are "taking advantage of Texas."
Asked whether future construction could go ahead under stricter rules, she said local communities must have a say in whether and how projects move forward.
Her campaign platform also calls for an immediate moratorium and criticizes long tax breaks granted to large data-center projects.
Hinojosa defeated Republican incumbent Greg Abbott in Tuesday's election and is scheduled to take office in January.
The Nasdaq Composite plunged 5.52 percent on Thursday, while the S&P 500 fell 4.36 percent and the Dow Jones Industrial Average dropped 3.44 percent.
All three indexes recorded their worst sessions since April 2025, erasing the previous day's gains.
Investors feared that tighter rules could weaken demand for artificial intelligence chips, electricity and cloud computing services.
Chipmaker Nvidia lost 9.3 percent, Advanced Micro Devices tumbled 17.3 percent and power equipment supplier GE Vernova fell 7.5 percent.
The Nasdaq finished the day 11.9 percent below its record high, placing it in correction territory.
The losses followed heavy selling in data-center and power-related stocks on Wednesday, when Cipher Digital fell 21 percent during intraday trading.
Power producers Vistra and Constellation Energy also came under pressure, falling 15.4 percent and 9.2 percent, respectively.
Data centers house the servers that run artificial intelligence and cloud services, which is why rules governing them can ripple through chip and power companies.
