S&P 500 dips as chip stocks give up gains

The S&P 500 dipped on Thursday, with Intel and other ​chip stocks retreating after a recent rally, while uncertainty around US-Iran peace talks weighed on the wider market.

US-listed ‌shares of Arm Holdings dropped 10% as worries about the company’s ability to secure sufficient supplies for its new AI chip overshadowed a strong earnings forecast.

Intel fell 1.9% and Advanced Micro Devices declined 3.1%, giving back some of their gains from earlier this week.

The PHLX chip index lost 2.4%, trimming its ​gain so far this quarter to 45%.

The United States and Iran were edging toward a temporary agreement to halt their ​war, sources and officials said, with Tehran reviewing a proposal that would stop the fighting but ⁠leave the most contentious issues unresolved.

“You can have a string of days like this, and that’s not going to take away ​from the fact that this has been a rip-roaring quarter of recovery, driven by fundamentals,” said Mike Dickson, head of portfolio management ​at Horizon Investments in Charlotte, North Carolina.

Oil prices , fell 1%, bouncing off session lows in volatile trading.

The S&P 500 energy index led declines among the major sectors with a 2.3% drop.

Nvidia and Microsoft both rose more than 2%, underscoring investor confidence in Wall Street’s heavyweight AI companies.

The S&P 500 was ​down 0.40% at 7,335.96 points.

The Nasdaq declined 0.15% to 25,799.74 points, while the Dow Jones Industrial Average was down 0.55% at ​49,638.38 points.

A relentless rally in technology and AI shares has helped push U.S. stocks to record highs in recent days as investors cheer signs ‌of ⁠strong demand for artificial intelligence and a robust earnings season. are on track for their strongest profit growth in more than four years.

Upbeat economic readings in recent weeks have also helped allay concerns about the economy.

Data showed the number of Americans filing claims for unemployment benefits rose less than expected last week.

After a strong private payrolls report on Wednesday, investors are awaiting more comprehensive nonfarm ​payrolls data on Friday, with ​jobs seen increasing by 62,000 ⁠in April after rebounding 178,000 in March, according to a Reuters poll of economists.

Traders continued to bet the US Federal Reserve would hold interest rates steady through the end of the year ​due to a resilient labor market and elevated energy prices.

Cleveland Fed President Beth Hammack said she expects ​the central bank ⁠to hold interest rates steady well into the future as it navigates a climate of considerable uncertainty.

Cybersecurity stocks surged after Datadog raised its full-year earnings forecast. Datadog surged 29%, while peers CrowdStrike and Palo Alto Networks added 7% and 5.5%, respectively.

Whirlpool (WHR.N), opens new tab slumped 13% after the home-appliance ⁠maker missed ​first-quarter sales estimates and suspended its dividend.

Declining stocks outnumbered rising ones within the ​S&P 500 by a 1.7-to-one ratio.

The S&P 500 posted 18 new highs and 10 new lows; the Nasdaq recorded 126 new highs and 83 new lows.