EDITOR'S NOTE
The big sell-off in technology stocks continued for most of the day Tuesday as investors dumped growth high-flyers in the face of rising bond yields.
The Nasdaq Composite shed as much as 3.9%. The tech-heavy benchmark also fell below its 50-day moving average for first time since Nov. 3 on an intraday basis.
One of the biggest victims of the tech pullback this week is widely followed Wall Street investor Cathie Wood, whose funds are highly concentrated in high-growth companies.  Tesla, Palantir, Roku, Square, PayPal, Spotify and Shopify are all top holdings in Wood's flagship Ark Innovation ETF (ARKK) and Next Generation Internet ETF (ARKW), and these stocks were some of the biggest losers Tuesday at one point.
Fast forward to the final hour of trading and tech stocks rallied off their lows. Apple even turned green at one point. Tesla finished down just 2%.
The Dow finished 15 points higher, making up a 360-point loss. The intraday turnaround came after Federal Reserve Chairman Jerome Powell said in his testimony to Congress that inflation is still "soft" and the economic outlook is still "highly uncertain," easing fears of a policy change by the central bank.
Still the tech trade appears to be on shaky ground. Tech's historically high valuations become less justifiable with interest rates on the rise, while investors rushed to rotate into cyclicals to ride the economic rebound. Wood knows all too well that higher interest rates would pose a threat to her growth-focused portfolio.
"I do believe that if the [interest] rate were to take a sharp turn up that we would, we would see a valuation reset, and our portfolios would be prime candidates for that valuation reset," she said in an interview with CNBC last week. TOP NEWS
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