Nasdaq sells-off nearly 350 points led by tech giants, oil rebounds on Iran tensions

A tech-led sell-off led to the Nasdaq to plunge nearly 350 points on Tuesday. The index is now down in three out of the last four trading sessions, during which it has declined nearly 600 points.

On the flip side, a rotation into old economy shares kept the Dow Jones' losses down to 160 points and Walmart to cross $1 trillion in market capitalization. The Dow was also supported by PepsiCo, which surged 5% after strong results, while JPMorgan and CitiGroup also fared well.

The S&P 500 also fell over 1%. Despite the fall on the index, the market breadth was positive.

Anthropic's automation tool launch resurfaced concerns about the business model for Software-as-a-Service (SaaS) companies being at risk. Gartner shares plunged 21% overnight, while Adobe, Salesforce and others fell between 6% to 8% overnight. Microsoft also saw its fourth straight day of losses, declining 3% and weighing on the Nasdaq. Shares of AMD also plunged in extended trading after its guidance disappointed the street.

Oil prices rebounded after the early sell-off after the US navy said that it shot down an Iranian drone headed towards an aircraft carrier in the Arabian Sea.

“Rotation is occurring,” said Steve Sosnick at Interactive Brokers. “The tricky question is whether it is a benign reallocation of exposure or a sign of some underlying instability.”

Gold and Silver prices saw a rebound after the sharp sell-off over Friday and Monday, while the Dollar saw some profit booking after its biggest two-day advance since April last year.

Over 100 S&P 500 companies, including Amazon and Alphabet are scheduled to report results this week. Alphabet reports results after market hours today, while Amazon reports on Thursday.