US stocks today: US stocks turn choppy as megacaps offset chip gains before Fed meet

US stocks traded in a narrow range on Wednesday as gains in chipmakers following strong results from South Korea's SK Hynix were offset by declines in heavyweight technology stocks, with investors awaiting the Federal Reserve's interest rate decision and key earnings from Microsoft and Alphabet, Reuters reported.

At 10:01 a.m. ET, the Dow Jones Industrial Average was up 73.40 points, or 0.14%, at 52,450.97. The S&P 500 gained 0.09% to 7,729.20, while the Nasdaq Composite slipped 0.03% to 26,470.68, according to Reuters.

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Chip stocks rally on SK Hynix results

Memory chipmaker Micron Technology rose 4.8% to its highest level in more than two weeks after SK Hynix reported a more than sevenfold jump in quarterly profit. SK Hynix's US listed shares surged 10.6%, while the Philadelphia semiconductor index gained 0.9%, putting it on track for a fourth straight session of gains, Reuters said.

The strength in chips was partly offset by losses in megacaps. Tesla fell 1.9% after gaining more than 9% over the previous two sessions, while Apple slipped 0.6%. SpaceX dropped 3.2%.

Alphabet rose 1.2% after a media report said OpenAI plans to buy Google's AI chips.

Fed, AI spending and hyperscaler earnings in focus

The Nasdaq has gained about 2% this week as sentiment around artificial intelligence improved following Anthropic's US IPO filing on Monday. Attention now turns to Microsoft and Alphabet, which are due to report quarterly results after the closing bell, Reuters reported.

Investors are expected to focus on cloud growth and capital spending, particularly whether heavy AI investments are generating sufficient returns. Concerns over debt funded AI spending remain a drag on sentiment as borrowing costs rise.

"We can still see that the AI demand has not paused... the number one worry for investors is not AI valuations anymore, but it's the financing through debt as debt goes through the roof in the US," said Nadia El Bilassy, senior market analyst at Equiti Group.

The Fed's policy announcement is due at 2 p.m. ET, with markets broadly expecting a pause after last month's hike. Investors are likely to focus on Fed Chair Kevin Warsh's comments and the policy outlook, Reuters reported.

(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)