What's going on?

The Nasdaq Composite index fell into a technical �correction� on Monday, but investors had glossed over the hiccup just a day later.

What does this mean?

The tech-heavy Nasdaq rose 11% from the start of the year to hit its highest level ever by mid-February. But after weeks of poor performance, the index finally collapsed more than 10% from that peak on Monday � sending it into official correction territory. There�s nothing special about that in and of itself: it�d be far more worrying if there�d been a 20% drop, which would throw the Nasdaq into a �bear market�. But it does say a lot about how investors are behaving: the collapse was partly down to their long-anticipated rotation away from high-growth tech stocks in favor of economically sensitive �cyclical� and cheap-looking �value� stocks.

Why should I care?

For markets: Investors are buying the dip.

With the world focused on getting back to normal this year, companies whose earnings are closely tied to economic growth � think carmakers and construction firms � stand to benefit the most. Meanwhile, those whose earnings continue to grow no matter what � like the tech giants � will probably benefit the least. Still, investors were quick to �buy the dip� after the Nasdaq�s correction on Tuesday, initially sending the index straight back up 4% � so maybe the rotation analysts have been expecting in the States isn�t as straightforward as they thought.

Zooming out: The rotation is a-go in Asia.

At least the rotation is playing out exactly as predicted in Singapore: the country�s key stock market index is up 9% this year, flipping it from Asia�s worst performer in 2020 to its best so far this year. That�s probably because the index�s cyclical and value stocks make up 80% of its size � and they have a lot of room to rise after falling 12% last year.