By Shashwat Chauhan and Utkarsh Hathi
Oct 28 (Reuters) - US stocks wavered on Wednesday as weakness in megacaps such as Tesla and Apple offset chipmaker gains sparked by SK Hynix's bumper results, with focus squarely on hyperscaler earnings and the Federal Reserve's interest-rate decision later in the day.
Memory chipmaker Micron Technology jumped 4.8% to its highest in over two weeks after South Korean rival SK Hynix reported a more than sevenfold jump in quarterly profit. SK Hynix's US-listed shares
gained 10.6%.
The Philadelphia chips index was up 0.9%, on track to gain for the fourth straight session.
Capping gains on the main benchmarks, Tesla dipped 1.9% after surging more than 9% in the last two sessions. Apple eased 0.6%, while SpaceX dropped 3.2%.
Alphabet advanced 1.2% following a media report that OpenAI plans to buy Google's AI chips.
At 10:01 a.m. ET, the Dow Jones Industrial Average rose 73.40 points, or 0.14%, to 52,450.97. The S&P 500 gained 6.10 points, or 0.09%, to 7,729.20, while the Nasdaq Composite lost 7.13 points, or 0.03%, to 26,470.68.
Six of the 11 major S&P 500 sectors advanced, with communication services leading gains, while real estate lagged.
The Nasdaq has risen about 2% so far this week, following a bruising first half of the month, as sentiment toward AI improved after Anthropic revealed its US IPO filing on Monday.
The focus now shifts to quarterly results from hyperscalers Microsoft and Alphabet, due after markets close on Wednesday, with both companies expected to report accelerating cloud growth.
Investors will closely scrutinize their capital expenditure plans for signs that massive AI investments are generating returns, as concerns over the viability of debt-funded spending amid rising borrowing costs continue to weigh on the sector.
"We can still see that the AI demand has not paused... the number one worry for investors is not AI valuations anymore, but it's the financing through debt as debt goes through the roof in the US," said Nadia El Bilassy, senior market analyst at Equiti Group.
Also on the day, Vertiv jumped 14% after the digital infrastructure provider raised full-year profit and revenue forecasts, while also topping third-quarter expectations.
Boston Scientific shed 8.2% after the medical device maker trimmed its annual profit forecast.
Looking ahead, the US Fed's policy announcement is due at 2 p.m. ET on Wednesday. The market consensus is widely tilted toward a pause following last month's hike, with investors more focused on remarks from Fed Chair Kevin Warsh and the policy outlook.
Market expectations, however, remain hawkish as traders see at least three 25-basis-point increases by late 2027, according to LSEG data, as persistently high inflation due to rising energy costs tied to the Middle East conflict bolster the case for tighter monetary policy.
September's Personal Consumption Expenditures report, the Fed's preferred inflation gauge, could test those bets on Thursday. Third-quarter GDP, which is expected to show 3.2% growth, is also due this week.
Declining issues outnumbered advancers by a 1.06-to-1 ratio on the NYSE, while advancing issues outnumbered decliners by a 1.08-to-1 ratio on the Nasdaq.
The S&P 500 posted 16 new 52-week highs and nine new lows, while the Nasdaq Composite recorded 52 new highs and 96 new lows.
(Reporting by Shashwat Chauhan and Utkarsh Hathi in Bengaluru; Editing by Shilpi Majumdar)
