Tech Leads Stock Market Sell-Off as Jitters Flare Up on Wall Street

• Software stocks were hammered by AI disruption concerns, with Intuit down over 11% and Salesforce falling nearly 7% after AI startup Anthropic released workplace productivity tools
• Tech giants also declined, with chip makers Nvidia and Broadcom each dropping about 3%, while most Magnificent Seven stocks shed more than 1%
• The sell-off lacked a clear trigger but appeared to accelerate year-to-date trends, with gold rising over 6% as investors sought safe-haven assets

Market Summary: Tech-Led Sell-Off Driven by AI Disruption Fears

Market Performance:

U.S. stocks declined Tuesday, with technology leading losses. The Nasdaq fell 1.4%, the S&P 500 dropped 0.8%, and the Dow Jones Industrial Average slid 0.3% after hitting a record high earlier in the session. The CBOE Volatility Index (VIX) surged above 20, indicating rising investor anxiety, while gold gained over 6% as a safe-haven asset.

Key Drivers:

Software stocks experienced significant pressure amid growing concerns over AI disruption. The sell-off intensified following AI startup Anthropic's release of workplace productivity tools, raising fears about enterprise software displacement. Intuit plunged over 11% and Salesforce dropped nearly 7%. This marks an acceleration of software sector weakness evident throughout early 2026.

Tech Sector Impact:

The broader technology sector suffered collateral damage. Semiconductor giants Nvidia and Broadcom each declined approximately 3%. Most Magnificent Seven stocks lost over 1%, with exceptions being Apple and Tesla. Investors are now bracing for upcoming earnings reports from Alphabet and Amazon.

Market Context:

The sell-off lacked a singular catalyst, unlike previous volatility triggered by Trump administration headlines or economic data. Wall Street consensus anticipates a solid but volatile year for 2026. The market had been riding high, with the S&P 500 near record levels before Tuesday's decline.

Notable Exceptions:

Data storage stocks bucked the trend, with Western Digital surging 7%.

Outlook:

With major tech earnings approaching and persistent AI disruption concerns affecting the software industry, investors face continued uncertainty despite analysts' generally positive full-year outlook.