By Noel Randewich and Johann M Cherian
Sept 22 (Reuters) - The Nasdaq rose on Tuesday, touching an intraday record high with a boost from Micron Technology and other AI-related stocks, while the S&P 500 hovered near flat and just short of a record high as oil prices traded around $100 per barrel.
Chip stocks added to recent gains while consumer-related software shares lost ground. Investors focused on the strong reception of Meta Platforms' AI assistant, which launched earlier this month and can send
emails and complete transactions on behalf of a user.
The success of the AI assistant, called Muse, has fueled gains for AI-related chip stocks in recent days. Yet some worried it could compete with the retailers, online brokerages and other consumer companies. Amazon on Monday blocked the agent from shopping on its platform.
"There are a lot of tech stocks that are down today on Muse-related fears of one sort or another," said Jed Ellerbroek, portfolio manager at Argent Capital Management. "People fear that Muse will be used to manage your insurance relationships, book your travel and search for stuff to buy."
Uber Technologies and Lyft were down about 1%, while Expedia fell 4% and Charles Schwab slid 5.5%.
Micron rose 3.9%, while Sandisk rallied 7.2%.
Oil prices were choppy near $100 a barrel, while the yield on the benchmark 10-year Treasury note hovered around 4.97% after US President Donald Trump warned in a speech to the UN General Assembly that he could "annihilate the Islamic Republic" if no deal is reached to end the Middle East conflict.
Investors also focused on a U.S.-China summit on Thursday, with traders speculating that the trade truce with Beijing could be extended and talks could touch upon AI regulation.
"What people are looking for is at least the start of a conversation that maybe you can come up with some sort of global framework as opposed to fighting each other and having this race and so," said Joe Saluzzi, head of equity market structure research at Themis Trading.
The S&P 500 was up 0.04% at 7,767.88 points.
The Nasdaq gained 0.38% to 27,225.39 points. During the session it topped its June 1 intraday record high.
The Dow Jones Industrial Average was down 0.35% at 51,868.18 points.
The S&P 500 was less than 0.5% below its August 13 record high close.
The S&P 500 is trading at just under 19 times expected earnings, its lowest valuation since 2023, according to LSEG data. AI-related heavyweights are responsible for much of the recent increase in earnings expectations.
JPMorgan Chase and Wells Fargo both dipped more than 3% on Tuesday.
Six of the 11 S&P 500 sector indexes rose, led by materials, up 1.76%, followed by a 1.15% gain in consumer staples.
Boston Federal Reserve President Susan Collins wrote she supported last week’s central bank interest rate increase, citing inflation risks.
New York Fed President John Williams said the Fed's framework for controlling short-term rates has been effective in supporting financial markets.
Traders see a 53% chance the central bank will increase interest rates by at least 25 basis points in October, the CME Group's FedWatch Tool showed.
Advancing issues outnumbered falling ones within the S&P 500 by a 1.1-to-one ratio.
The S&P 500 posted eight new highs and 11 new lows; the Nasdaq recorded 40 new highs and 90 new lows.
(Reporting by Johann M Cherian and Tharuniyaa Lakshmi in Bengaluru, and by Noel Randewich in San Francisco; Editing by Joyjeet Das, Devika Syamnath and David Gregorio)
