Markets whipsaw as AI sell-off resumes | CNN Business

Stocks swung in volatile trading Tuesday as investors sold AI-related names, rotated into other sectors and took profits after a strong rally in recent months. The tech-heavy Nasdaq Composite opened higher before dropping more than 3.6% in a rapid reversal during trading. But investors stepped in to buy the dip, and by the closing bell, the Nasdaq was down only 0.97%. Similarly, the S&P 500 fell more than 2.2% before dip-buyers stepped in. The S&P ended the day down just 0.26%. The Dow, which has less exposure to tech, gained 86 points, or 0.17%, recouping losses after tumbling about 575 points earlier. After an extraordinary rally this year, semiconductor chip makers bore the brunt of the selling. Declines in tech and AI stocks, including the chipmakers, weighed on the major indexes. “It’s not unusual to see a period of consolidation after exceptional performance,” said Bill Northey, senior investment director at US Bank Asset Management. The fundamentals underpinning the chipmaker rally this year are real, Northey said, but when one sector has such strong performance, it should be expected that there are “bouts of consolidation … as enthusiasm ebbs and flows.” The Nas