Dow closes lower by 400 points, Apple shares drag tech down: Live updates
Traders work on the floor of the New York Stock Exchange during morning trading on February 29, 2024 in New York City.

Stocks fell for a second session Tuesday, as steep declines in major tech names such as Apple dragged the broader market further from record highs recently reached.

The Nasdaq Composite pulled back by 1.65% to 15,939.59 as technology stocks felt the brunt of the market's drop. The Dow Jones Industrial Average lost 404.64 points, or 1.04%, to 38,585.19. The S&P 500 dipped 1.02%, closing at 5,078.65.

Apple slipped almost 3% on the back of a report from Counterpoint Research that found iPhone sales plunged in China in the first six weeks of 2024.

Several other mega-cap technology stocks including Netflix and Microsoft shed close to 3%, while Tesla dropped nearly 4%. The S&P 500's information technology sector led the broad index down with a loss of more than 2%.

Outside mega-cap tech, GitLab tumbled 21% after the software company posted a weak forecast for the full year. Intel and Salesforce were the worst performers in the Dow, with each retreating by more than 5%.

"The taller they grow, the harder they fall," said Scott Ladner, CIO at Horizon Investments, of struggling tech stocks. "What's going on today, internally, is the stuff that has been winning all year long is the stuff that's getting sold."

Beyond tech, Target jumped 12% after holiday-quarter earnings came in stronger than Wall Street forecasted. AeroVironment rallied almost 28% following a better-than-anticipated quarterly report and outlook from the defense company.

Tuesday's moves come as investors continue to digest the market's recent rally to all-time highs, which has been powered by optimism around artificial intelligence. Despite the losses in the past two sessions, the three major averages are solidly higher year to date.

Bitcoin was the latest asset to hit a record, notching an all-time high on Tuesday. However, the digital currency quickly moved into the red after surpassing the peak for the first time in two years.