WASHINGTON, July 6 (Reuters) - Wall Street was higher in midday trading Monday on the back of continued optimism around chip stocks, while oil lost ground amid an anticipated surge in supply.
In the early afternoon, all three major U.S. indices were higher, after European stocks flirted with record highs earlier in the day before retreating ahead of a crucial earnings season for the AI sector.
The Dow Jones Industrial Average (.DJI), rose 0.07%, to 52,938.04, the S&P 500 (.SPX), was last up 0.73%, to 7,537.75 and the Nasdaq Composite (.IXIC), jumped 1.25%, to 26,155.56. MSCI's gauge of stocks across the globe (.MIWD00000PUS), climbed 0.45%, to 1,128.87.
The global AI boom continued to dominate markets. South Korean chipmaker SK Hynix 000660.KS, on Monday launched a U.S. share sale to 43 trillion won ($28.07 billion) and indications of interest for up to $7 billion from major investors. And Broadcom (AVGO.O), announced it had expanded its partnership with Apple (AAPL.O), to develop and supply custom chips through 2031.
Elsewhere, Microsoft (MSFT.O), joined the trend of tech layoffs, announcing it would eliminate around 4,800 jobs, roughly 2.1% of its global workforce. Investors will be watching closely for how artificial intelligence-related companies are faring amid some fears about a bubble in the upcoming earnings season.
Delta Air Lines (DAL.N), and PepsiCo (PEP.O), are the big U.S. names reporting this week. Samsung Electronics (005930.KS), is set to make a splash on Tuesday as analysts expect an 18-fold increase in profits.
OIL SLIPS
Oil prices were down but trading around pre-Iran war levels Monday. U.S. crude fell 0.55% to $68.31 a barrel and Brent fell to $71.75 per barrel, down 0.51% on the day.
While there were no new developments in the fractious U.S.-Iran peace talks, ships are passing through the Strait of Hormuz, with 160 vessels reported transiting from Monday to Saturday last week.
OPEC+ also agreed to a further increase in output targets by 188,000 barrels per day from August.
The dip in oil prices looks to be extending some relief to the private sector, as the decline helped to slow the pace of increase in services inflation, according to new data from the Institute for Supply Management. The ISM reported that U.S. services sector activity dipped in June, but employment rebounded after contracting for three straight months.
U.S. President Donald Trump will attend a NATO meeting in Turkey this week, and Fed watchers will get another glimpse into how new Chairman Kevin Warsh steers the central bank when it releases Federal Open Market Committee minutes on Wednesday, the first of his tenure.
"We expect Warsh to make the FOMC minutes less informative with respect to the views expressed at the FOMC meetings. ... Warsh explicitly avoided policy guidance in the statement and press conference, so it seems unlikely that he would permit such guidance via the minutes," Steve Englander, global head of G10 FX research and North American macro strategy at Standard Chartered Bank, wrote in a note.
The yield on benchmark U.S. 10-year notes rose 0.22 basis points to 4.481%, from 4.479% late on Thursday.
In currency markets, the dollar index rose 0.07% to 100.94 after dipping in the wake of Thursday's weaker-than-expected June U.S. payrolls report. The dollar firmed 0.53% to 162.23 yen , not far from 40-year peaks of 162.84, as speculators test Japanese authorities' resolve on intervention.
In commodity markets, gold was 0.56% lower at $4,152.11 an ounce , after bouncing 2% last week.
Reporting by Pete Schroeder in Washington; Editing by Jacqueline Wong, Stephen Coates, Will Dunham and Thomas Derpinghaus
