New York CNN  —  Tech shares fell Wednesday as investors shed the behemoths that fueled Wall Street’s monster stock rally this year. The Nasdaq Composite index tumbled 2.7% and the S&P 500 lost 1.3%. The Dow rose 0.5%. Shares of tech heavyweight Nvidia (NVDA) slumped 6.2% and rival chipmaker Advanced Micro Devices (AMD) dropped by 7.8%. The selloff comes after a Tuesday report from Bloomberg that the Biden administration is mulling plans to impose more sanctions on Chinese tech firms and to heighten semiconductor trade restrictions between the US and China. Investors are also selling tech stocks after a cool inflation report last week and stronger-than-expected retail sales data on Tuesday pushed up bets for a rate cut in September. Wall Street is looking to beaten-down stocks that tend to perform better when borrowing costs are low. The Russell 2000 index, which tracks the performance of small-cap stocks, fell in midday trading Wednesday but is still up 4.7% for the week. The Magnificent Seven tech stocks, which have led most of the gains this year thanks to the artificial intelligence boom, tumbled. Microsoft (MSFT) shares fell 2%, Apple (AAPL) shares slid 2.8%, Amazon (AMZN) shares declined 3.3% and Meta Platforms shares lost 4.5%. This is a developing story and will be updated.