NEW YORK: The Nasdaq fell more than 2% on Tuesday as steep declines in megacap growth stocks pushed Wall Street below record trading levels, with investors seeking shelter in more defensive parts of the market.

Highly valued technology companies including Microsoft Corp, Alphabet Inc, Apple Inc, Amazon.com Inc and Facebook Inc fell between 2.3% and 4.2%.

All the 11 major S&P 500 sectors were down, with technology, communication services and consumer discretionary falling more than 2% each.

The defensive consumer staples, utilities and real estate sectors fell the least.

US and European stock markets also saw a sudden 0.5% drop in hefty volumes around 7:30 a.m. ET on Tuesday, leaving traders perplexed.

At 11:49 a.m. ET, the Dow Jones Industrial Average was down 235.73 points, or 0.69%, at 33,877.50, the S&P 500 was down 56.17 points, or 1.34%, at 4,136.49 and the Nasdaq Composite was down 379.74 points, or 2.73%, at 13,515.38.