Nasdaq dips as chipmakers slide; S&P 500 treads water with Fed in focus

Nvidia, which has cornered 80% of the AI chip market, is expected to provide more details on pricing at its presentation later in the day.

Fellow chipmakers such as Advanced Micro Devices, Marvell Technology and Intel shed between 2.3% and 6.1%, while the Philadelphia Semiconductor index dipped 2.1% to its lowest since Feb. 29.

"It is profit taking from the Nvidia conference ... wherever Nvidia goes these chips are going," said Dennis Dick, a trader at Triple D Trading.

"They are getting hit hard today but let's put it in perspective, it's been a pretty good year for a lot of these stocks."

At 11:35 a.m. ET, the Industrial Average was up 203.55 points, or 0.52%, at 38,993.98, the S&P 500 was up 2.21 points, or 0.04%, at 5,151.63, and the Nasdaq Composite was down 42.25 points, or 0.26%, at 16,061.19.

Four of the 11 major S&P 500 sectors were trading were lower, while Tesla and Meta Platforms eased more than 1% each, lagging most megacap growth stocks.

Meanwhile, Dow outpaced its Wall Street peers, supported by gains in Home Depot and McDonald's.

All three major stock indexes finished higher in the previous session, with the Nasdaq bouncing back from two successive small weekly losses as growth stocks such as Alphabet and Tesla boosted the tech-heavy index.

Focus will remain on U.S. central bankers who are expected to hold rates steady at the end of their two-day meeting on Wednesday.

But, investors are concerned that their new economic projections may be a wild card.

"The 'dot plot', meanwhile, might show FOMC (Federal Open Market Committee) members' concerns that inflation remains higher than expected, and thus push forward rate cuts, until greater disinflation must be achieved," said Naomi Fink, global strategist at Nikko Asset Management.

Robust inflation data has pushed traders to pull back bets of the first rate cut coming in June to 59.4% from 71% at the start of last week, according to the CME FedWatch Tool.

Among other movers, crypto-exchange operator Coinbase Global and miners Riot Platforms and Marathon Digital Holdings shed between 4.8% and 6.5%, tracking the sharp slide in bitcoin.

AI server maker Super Micro Computer dropped 10.9% after announcing that it will sell 2 million shares that could fetch about $2 billion.

Spire Global jumped 28.6% after the company announced a collaboration with Nvidia for AI-driven weather prediction.

Advancing issues outnumbered decliners by a 1.50-to-1 ratio on the NYSE and by a 1.28-to-1 ratio on the Nasdaq.

The S&P index recorded 38 new 52-week highs and one new low, while the Nasdaq recorded 37 new highs and 83 new lows.