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.

Palantir's price-to-sales ratio of 114 is way above OpenAI's 17. Palantir's success in defense work could block access to growth as enterprise AI payoff remains elusive

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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.

Wall Street is edging lower on Tuesday following drops for Palantir and other stars that had been riding the mania surrounding artificial-intelligence technology. The S&P 500 slipped 0.4% and is on track for a third straight modest loss after setting its all-time high last week.