The sudden reversal shows how the hottest AI trade and top-performing stock of the year is colliding with a broader market rotation out of big tech.

Nvidia, Palantir and other superstar stocks that had surged in the mania surrounding artificial-intelligence technology are dragging Wall Street lower again on Wednesday. The S&P 500 fell 0.5% and was heading for a fourth straight loss after setting an all-time high last week.