Rocket Lab USA, Inc. (RKLB) saw its stock price plummet 5.03% during intraday trading on Tuesday, marking a significant pullback for the commercial space company.

The sharp decline follows reports that Cathie Wood's ARK Investment Management engaged in profit-taking across several technology holdings including Rocket Lab. This selling pressure from a prominent investor contributed to the downward momentum. Additionally, analysts point to a broader capital rotation within the aerospace sector, where funds are being diverted following the highly successful initial public offering of SpaceX last week. The SpaceX debut, which saw shares surge nearly 19%, has created a "siphon effect," drawing investment away from other commercial space players like Rocket Lab.

Market observers note that Rocket Lab's drop also reflects technical selling and profit-taking activity after the stock experienced a substantial rally in the previous session. This combination of influential investor selling and sector-wide capital shifts has driven the stock's significant intraday decline.