NEW YORK, New York - U.S. stocks ended sharply lower Tuesday with tech stocks, mostly behind AI, leading the way. Anthony Saglimbene of Ameriprise said in an interview with CNBC that without a pullback, valuations are beginning to get "really stretched."

"We haven't really seen any major corrections or any real pressure on stocks since April," the firm's chief market strategist told CNBC. "Profits are good, but I think investors are starting to ask themselves, based on the pace of capital expenditure investments from some of these key Big Tech companies, ‘Are you going to see the profit growth over the next year to justify the levels of capex?'"

Wall Street stumbled into the close on Tuesday, with the sharpest, sell-off in technology stocks pulling the Nasdaq Composite to its worst performance in weeks. The broad retreat reflected renewed investor jitters about persistent inflation and the prospect of prolonged higher interest rates from the Federal Reserve.

The tech-heavy Nasdaq Composite bore the brunt of the selling, plunging 458.00 points, or 1.92 percent, to finish at 23,376.72.

The benchmark Standard and Poor's500 also fell sharply, dropping 80.35 points, or 1.17 percent, to close at 6,771.62.

The Dow Jones Industrial Average, comprised of 30 blue-chip stocks, demonstrated relative resilience but still closed in negative territory, declining 307.38 points, or 0.65 percent, to settle at 47,029.30.

The day's losses were driven by a significant pullback in the mega-cap technology stocks that have powered the market for much of the year. Investors are increasingly grappling with the realization that the era of cheap money is firmly over, which pressures the high valuations of growth-oriented companies.

"Today's action is a classic 'risk-off' move," said a senior market analyst. "With bond yields ticking higher on strong economic data, the market is re-rating the future earnings potential of tech and growth stocks. It's a painful but necessary recalibration."

The sell-off sets a cautious tone for the trading week, with all eyes turning to upcoming economic reports and corporate earnings for signals on the health of the U.S. economy and the future path of monetary policy.

U.S. Dollar Flexes Muscle as Major Currencies Wobble in Latest Session

The U.S. dollar demonstrated broad strength in the latest foreign exchange market session, climbing against most major counterparts while safe-haven and commodity-linked currencies faced significant selling pressure.

The greenback's rally was particularly evident against the British Pound and the Antipodean currencies. The GBP/USD pair was one of the session's biggest movers, tumbling 0.95 percent to trade at 1.3014. The sell-off was even more pronounced for the New Zealand dollar, with NZD/USD plunging a full 1.00 percent to a fragile 0.5648. The Australian dollar followed suit, with AUD/USD falling 0.81 percent to 0.6483.

The euro also softened against the resurgent dollar, with EUR/USD declining 0.34 percent to 1.14800. Meanwhile, the USD/JPY pair dipped 0.40 percent to 153.596, a move that still leaves the yen near multi-decade lows.

The dollar's strength was not universal, but its gains were clear against certain key pairs. The USD/CAD pair rose 0.32 percent to 1.41008, putting pressure on the Canadian dollar. In a notable shift, the U.S. dollar also advanced against the traditionally resilient Swiss franc, with USD/CHF climbing 0.42 percent to 0.8103.

Analysts suggest the dollar's strength is being driven by a reassessment of interest rate expectations, with markets pricing in a more "higher-for-longer" stance from the U.S. Federal Reserve compared to other major central banks. This dynamic has siphoned capital away from risk-sensitive and lower-yielding currencies, fueling the dollar's ascent.

The sustained pressure on the Japanese yen will be a key focus for traders, as the USD/JPY rate continues to test levels that have previously drawn verbal intervention from Japanese financial authorities.

Global Markets Paint a Mixed Picture as European and Asian Indices Mostly Retreat

Global equity markets presented a fractured landscape in the latest trading session, with European and most Asian benchmarks closing in negative territory Tuesday, while the UK's FTSE managed a slight gain.

The pan-European STOXX 600 saw broad declines, led by Germany's DAX, which fell 183.30 points, or 0.76 percent, to close at 23,949.11. France's CAC 40 was not far behind, dropping 42.26 points, or 0.52 percent, to finish at 8,067.53. The eurozone's blue-chip EURO STOXX 50 index mirrored the trend, declining 0.34 percent to 5,660.20.

In a contrasting move, London's FTSE 100 proved resilient, edging up 13.59 points, or 0.14 percent, to close at 9,714.96. Belgium's BEL 20 also finished in the green, adding 0.28 percent to settle at 4,920.87.

Canada's S&P/TSX Composite index tumbled 478.00 points, or 1.58 percent, to end the session at 29,797.06, 

The sell-off was more pronounced across the Asia-Pacific region. Japan's Nikkei 225 was a notable laggard, tumbling 914.14 points, or 1.74 percent, to end at 51,497.20. South Korea's KOSPI experienced an even steeper decline, plunging 100.13 points, or 2.37 percent, to 4,121.74. Australia's S&P/ASX 200 fell 0.91 percent, while the broader All Ordinaries index dropped 0.92 percent.

In Hong Kong, the Hang Seng Index declined 0.79 percent to 25,952.40, and Taiwan's TWII retreated 0.77 percent. Mainland China's SSE Composite saw a more modest dip of 0.41 percent.

Other Asian markets showed varied performance. India's S&P BSE Sensex fell 0.62 percent, and Indonesia's IDX Composite was down 0.40 percent. Bucking the regional trend, New Zealand's S&P/NZX 50 climbed 0.37 percent, and Malaysia's KLCI eked out a minimal gain of 0.07 percent.

In the Midddle East, Egypt's EGX 30 was a standout performer, jumping 1.15 percent.  Israel's TA-125 closed marginally lower, down 0.20 percent..

Conversely, in Africa, South Africa's Top 40 USD Index fell sharply by 2.64 percent.

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