AI chip stocks experienced a downturn as a significant week of tech earnings approaches. The Nasdaq composite dipped 0.2%, while the Dow industrials climbed 0.5%.

Concerns over competition from Chinese chip makers, highlighted by CXMT's debut and Apple's lobbying efforts, impacted U.S. firms. Nvidia's stock fell 5% following reports of a substantial investment in an OpenAI data-center project, raising investor worries about the chip giant's customer investments. This decline led Nvidia to cede its position as the largest U.S. company by market capitalization back to Apple, a title it had held since May of the previous year.

Alphabet's shares also saw a dip after disclosing negative cash flow amidst heavy AI spending. The PHLX Semiconductor Index closed down 2.2%, with every stock in the index falling below its 50-day moving average for the first time since April 2025. Investors are showing a preference for other market sectors, with software stocks like Salesforce performing strongly, and traditional companies such as 3M, Walmart, and McDonald's contributing to the Dow's gains.