US STOCKS-Wall Street indexes close at record highs as Intel soars on Nvidia stake
By Abigail Summerville and Sukriti Gupta
Sept 18 (Reuters) - Wall Street's main indexes posted record-high closes on Thursday, a day after the U.S. Federal Reserve delivered a quarter-point interest rate cut, while chipmaker Intel rose after Nvidia decided to build a stake in the company.
Intel INTC.O was on track for its biggest daily gain since October 1987 after Nvidia NVDA.O said it would invest $5 billion in the struggling U.S. chipmaker. Peer Advanced Micro Devices AMD.O slipped.
Nvidia rose, recovering losses from Wednesday when a report said Chinese tech firms might stop buying its chips.
The moves boosted a broader semiconductor .SOX index, and also lifted the tech-heavy Nasdaq and the S&P 500 technology sector .SPLRCT.
The small-cap Russell 2000 index .RUT rose and touched an intraday record high of 2,466 points for the first time since November. Small-cap companies are likely to perform better in a low interest-rate environment.
On Wednesday, Fed Chair Jerome Powell emphasized that the softening jobs market was a priority and indicated more reductions could follow at upcoming policy meetings.
"We are looking for support for economic growth and justification of stretched valuations and the prospect of lower interest rates helps that," said Sam Stovall, chief investment strategist at CFRA Research.
According to preliminary data, the S&P 500 .SPX gained 30.92 points, or 0.47%, to end at 6,631.27 points, while the Nasdaq Composite .IXIC gained 207.17 points, or 0.93%, to 22,468.50. The Dow Jones Industrial Average .DJI rose 130.07 points, or 0.28%, to 46,148.39.
New data showed that the number of Americans filing new applications for unemployment benefits fell last week, but the labor market has softened as both demand for and supply of workers have diminished.
The rate cut is expected to add to Wall Street's recent rally, boosted by monetary policy easing hopes and a revival of AI-linked stock trading. Investors are pricing in about 44.2 basis points in cuts by end-2025, data compiled by LSEG showed.
Among stocks, CrowdStrike CRWD.O gained after at least nine brokerages raised their price target on the stock.
Shares of Darden Restaurants DRI.N fell after the Olive Garden parent reported weak quarterly results.
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