Icahn himself seemed to try to calm some of the reaction to his comments in a statement Monday evening.
"It is almost impossible to predict what a market will do in the short term. There are too many variables," he said.
"Often when we are concerned about the market, we hedge to some extent and this is one of those times. Interestingly, our investment funds had an annualized return of approximately 27 percent since January 1, 2009, and that return would have been greater if we had not hedged. As I have often said, picking short term moves in the market is like predicting how many sevens the "hot" dice player will continue to roll."
The investor, famed recently for taking to Twitter and pressing for a buyout at technology giant Apple, may just be confirming existing fears, according to some market strategists. And when markets go through what has been previously been viewed as a barrier, it can lead to increased nervousness in the markets.
"Nothing he said was particularly surprising as a lot of people have been thinking the same thing about these moves higher," Michael Hewson, chief market analyst at CMC Markets, said. He blamed the fall in stocks, following Icahn's remarks, on profit taking.
(Read more:Are we in neverending bubble economy?)
Some investors have been warning of a bubble forming since the U.S. stock market's medium-term rally began in June.
"What did he really say that's new news? People realize the markets are overvalued, and ahead of itself based on the fundamentals, so comments like that give the high frequency guts the opportunity to hit the sell button," Kenny Polcari, director of NYSE floor operations at O'Neil Securities, told CNBC.
"Large asset managers are not making decisions on one negative comment or speech Carl Icahn gives at a conference."
- By CNBC's Catherine Boyle. Twitter: