Volatility has returned to the stock market, and AI is once again the culprit.

The tech-heavy Nasdaq dropped 2.21% and the S&P 500 fell 1.44% Tuesday as investors sold semiconductor chip stocks and other AI-related shares. The Dow, which has less exposure to tech, was down about 0.1%.

The S&P and Nasdaq each had their worst day in about two weeks. The declines came after steep sell-offs in Asia. Nerves about AI quickly spiraled into full-on panic trading in South Korea on Tuesday, where the Kospi index tumbled 10%, tripping a circuit breaker that led to a 20-minute cooling-off session.

SK Hynix and…