US STOCKS-Tech stocks lift S&P, Nasdaq, Intel's drop and geopolitics cap gains

By Sruthi Shankar and Pranav Kashyap

Jan 23 (Reuters) - The S&P 500 and Nasdaq ticked higher as investors piled into some mega-cap stocks, but Intel's plunge on a downbeat outlook and lingering geopolitical tensions sapped overall risk appetite.

Stocks had rebounded in the past two sessions following Tuesday's sharp selloff triggered by U.S. President Donald Trump's threats to impose tariffs on European allies until Washington was allowed to buy Greenland.

Trump later tempered tariff threats and ruled out taking Greenland by force. The S&P 500 and Dow were on track for modest weekly declines while the Nasdaq edged toward a small gain. Persistent safe-haven demand pushed gold to a record and lifted silver above $100 an ounce for the first time. GOL/

A big drag on Friday was chipmaker Intel INTC.O, which sank 15.6%. The company forecast quarterly revenue and profit below market estimates, saying it struggled to satisfy demand for its server chips used in AI data centers. Its shares have risen about 25% since the start of the year.

An index of semiconductors .SOX fell 1%, off its record high hit in the previous session, while Wall Street's fear gauge .VIX ticked up after falling for the past two sessions.

"Some of these AI stocks have been inflated dramatically and they're going to need to start showing more than just hope, some real plans there," said Joe Saluzzi, partner and co-founder at Themis Trading.

At 11:35 a.m. ET, the Dow Jones Industrial Average .DJI fell 238.52 points, or 0.48%, to 49,145.49, the S&P 500 .SPX gained 9.86 points, or 0.14%, to 6,923.21 and the Nasdaq Composite .IXIC gained 112.84 points, or 0.48%, to 23,548.86.

MAG 7 EARNINGS TEST

A fresh bid for some mega-cap tech stocks buoyed the benchmark index as investors leaned into familiar names. Microsoft MSFT.O and Netflix NFLX.O were up 3% each while Meta META.O and Amazon AMZN.O rose 2.3% each.

Nvidia NVDA.O rose 1.6% after Bloomberg News reported Chinese officials have told Alibaba 9988.HK, Tencent 0700.HK and ByteDance they can prepare orders for Nvidia's H200 AI chips.

Many of the so-called Magnificent Seven stocks, including Apple AAPL.O, Tesla TSLA.O and Microsoft, are set to report earnings next week. Traders will be listening closely to management outlooks for clues on how much runway is left in the growth narrative that has helped prop up their premium valuations.

"We've got the S&P 500 at very rich valuations led by the Mag Sevens. We are certainly looking at the earnings and it's one of these things where you can't just meet expectations. You're going to need to see meet and beats and guidance potentially raised," Saluzzi added.

FED AWAITED

The Federal Reserve is expected to hold rates at 3.5%–3.75% next week, but investors will comb through the statement and Chair Jerome Powell's remarks for signals on what is next. The CMEGroup's FedWatch tool shows markets penciling in the first cut for June.

U.S. economic signals were broadly steady to start the year.

Business activity held firm in January as firmer new orders helped offset a still-soft jobs picture, S&P Global's flash PMI showed. Meanwhile, the University of Michigan survey showed consumer sentiment improving across the board this month.

Among other movers, U.S.-listed shares of miners such as Hecla Mining HL.N and Coeur Mining CDE.N rose 1.5% and 0.7%, respectively, as silver prices XAG= touched record highs and hit the $100-per-ounce mark for the first time.