Wall Street turns higher as Nvidia rebounds, focus on Fed meeting

Wall Street's major indexes gained ground on Tuesday with chip stocks paring earlier losses as Nvidia erased losses and investors looked ahead to the Federal Reserve's policy meeting conclusion on Wednesday for clues on interest rate policy.

Shares in chip maker Nvidia NVDA rebounded from earlier losses, last trading up 1.7%, after it revealed pricing and shipment plans for its hotly anticipated Blackwell B200 chip artificial intelligence chip, which it says is up to 30 times faster than its current chips.

After Nvidia's announcement late on Monday, rivals such as Advanced Micro Devices AMD and Intel INTC lost ground. The high-flying Philadelphia Semiconductor index SOX pared losses after hitting its lowest point since Feb. 29 but was still down 0.6%.

Investors were also preparing a day ahead of the Fed's policy update, including a press conference from Chair Jerome Powell. Robust inflation data has pulled back bets for the first rate cut in June to about 59.6% from about 69% at the start of last week, according to the CME FedWatch Tool.

"There's optimism that the Fed's not going to surprise us a lot on Wednesday," said Gene Goldman, chief investment officer at Cetera Investment Management. "We think three cuts are still on the table."

But, still he sees Powell reminding the market that he is cautious about inflation and that policy will depend on economic data and expects the central bank to update its inflation and economic growth projections.

The Dow Jones Industrial Average DJI outpaced its Wall Street peers, supported by gains in McDonald's MCD, Home Depot HD and Apple Inc AAPL.

At 02:24 p.m. the Dow was up 217.83 points, or 0.56%, at 39,008.45 while the S&P 500 SPX gained 20.81 points, or 0.40%, to 5,170.23 and the Nasdaq Composite IXIC climbed 55.97 points, or 0.34%, to 16,159.42.

Nine of the 11 major S&P 500 industry sectors were advancing with energy SPN leading gains as oil prices rose.

Communications services S5TELS was the biggest decliner with Meta Platforms META among its biggest losers.

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