04:55 PM EST, 01/27/2025 (MT Newswires) -- The S&P 500 and Nasdaq Composite declined on Monday as concerns regarding potential artificial intelligence competition from a Chinese startup rattled the US technology sector.

The tech-heavy Nasdaq declined 3.1% to 19,341.8, while the S&P 500 lost 1.5% to 6,012.3. The Dow Jones Industrial Average rose 0.7% to 44,713.6. The tech sector sank 5.6%, while utilities dropped 2.3%. Consumer staples paced the gainers.

China's DeepSeek recently launched a large language model that Wedbush Securities said "rivals" Microsoft ( MSFT ) -backed OpenAI's ChatGPT and Meta's (META) Llama 3.1. DeepSeek developed the technology in two months at a cost of less than $6 million, according to Wedbush.

Chip-making giant Nvidia's ( NVDA ) shares tumbled nearly 17% Monday, the worst performer on the Dow and among the worst on the Nasdaq. Broadcom ( AVGO ) slid 17%, among the steepest declines on the Nasdaq, along with Marvell Technology ( MRVL ) and Micron Technology ( MU ) . Microsoft ( MSFT ) shares fell 2.1%, while Meta rose 1.9%.

DeepSeek's AI assistant overtook ChatGPT as the top-rated free app on Apple's ( AAPL ) US App Store over the weekend, news outlets reported. The iPhone maker's shares rose 3.2% Monday, among the best performers on the Nasdaq and the Dow.

While Wedbush called the DeepSeek technology impressive, it doesn't believe that the firm will ultimately derail the US industry's path to artificial general intelligence dominance.

AT&T ( T ) logged better-than-expected fourth-quarter results and reiterated its full-year earnings outlook. The telecommunications giant's shares jumped 6.3%, the second-top gainer on the S&P 500.

Several major companies are scheduled to report results later this week, including mega-caps Apple ( AAPL ), Microsoft ( MSFT ), Meta, and Tesla (TSLA).

S&P 500 companies' latest quarterly earnings have surprised to the upside so far, pointing to "promising" early signs for the reporting season, Oppenheimer Asset Management said Monday.

The US 10-year yield fell 8.9 basis points to 4.53%, while the two-year rate lost 7.3 basis points to 4.2%.

A survey by Oxford Economics showed that Donald Trump's return as US president poses the biggest risk to world economic prospects.

"While geopolitical concerns have declined markedly, two-thirds of businesses judge that the US president's policies pose a very significant threat to the global economy over the next two years," the firm said.

West Texas Intermediate crude oil decreased 2.1% to $73.10 a barrel Monday.

In economic news, new-home sales in the US rose in December, while median prices at the national level picked up both sequentially and annually, government data showed.

"Looking past January, we expect new home sales to improve modestly in 2025, based on our forecast for mortgage rates to decline modestly over the course of the year," Oxford Economics said.

Texas manufacturing activity unexpectedly rose this month as orders increased, while expectations on the six-month horizon improved, according to the Federal Reserve Bank of Dallas.

Gold dropped 1.2% to $2,746.10 per troy ounce, while silver fell 1.9% to $30.61 per ounce.