S&P 500 hits intraday record high fueled by rate cut bets

Dec 24 (Reuters) - The S&P 500 index hit an intraday record high on Wednesday, its first in over a month, as investors returned to AI stocks and bet the Federal Reserve will cut rates again next year.

The index .SPX was last up 0.2% at 6920.88 points, surpassing its previous intraday peak of 6,920.34, set on October 29, when AI bellwether Nvidia NVDA.O had helped push the benchmark above a $5 trillion market valuation for the first time.

U.S. stocks have bounced back from their November lows as investors piled back into heavyweight tech and AI names heading into year-end. A benign inflation report and jobs report kept alive hopes of more interest rate cuts next year.

The benchmark index fell as much as 5.7% in November from its October peak, after investors grew wary of lofty tech valuations and a potential bubble in AI-linked stocks, even as Nvidia posted upbeat third-quarter earnings.

However, the AI trade regained momentum after chipmaker Micron Technology's MU.O issued an outsized profit forecast last week.

As technology stocks swung, investors rotated into cyclical sectors such as financials and materials, helping the S&P 500 recover from its November slump.

The S&P 500 has risen more than 17% year to date, while the tech-heavy Nasdaq index .IXIC is up more than 21% for the year and the blue-chip Dow .DJI has climbed more than 13% over the same period.