June 22 (Reuters) - The S&P 500 and the Dow inched higher on Monday, led by technology and financial shares, as investors assessed progress in the latest round of U.S.-Iran negotiations.
U.S. and Iranian officials made "encouraging progress" at the first round of their talks in Switzerland that ended early on Monday, mediators said, although tension persisted over Lebanon and the Strait of Hormuz.
Memory chipmakers moved higher, with Micron Technology (MU.O), and Sandisk (SNDK.O), gaining about 3% each.
The Philadelphia SE Semiconductor index (.SOX), rose 1.3% to a fresh record high. Intel (INTC.O), and Nvidia (NVDA.O), were up 2% and 1%, respectively.
Seven out of 11 major S&P 500 sectors were in the green, with financials (.SPSY), leading gains with a 1% rise.
Communication services (.SPLRCL), was a laggard, falling 2.3%. Alphabet (GOOGL.O), and SpaceX declined 3.8% and 7.9%, respectively, also weighing on the Nasdaq.
Oil prices fell as much as 2%, as Washington and Tehran agreed during the talks to a roadmap toward a final deal within 60 days.
Hopes of a peace deal helped the three key indexes end with significant weekly gains on Thursday, with the Nasdaq (.IXIC), gaining 2.4% as technology shares continued to drive markets higher.
"While markets have been resilient in recent weeks in the hope the Middle East conflict can be resolved and we don't see a persistent high inflationary environment, the Middle East conflict is still a live issue and that means investors aren't going into full-blown risk-on mood," said Dan Coatsworth, head of markets at AJ Bell.
At 9:53 a.m. ET, the Dow Jones Industrial Average (.DJI), rose 261.38 points, or 0.51%, to 51,826.08, the S&P 500 (.SPX), gained 23.77 points, or 0.32%, to 7,524.35 and the Nasdaq Composite (.IXIC), lost 1.52 points, or 0.01%, to 26,515.06.
AI-driven optimism has supported Wall Street's recent rally, while a resilient economy and hopes for an end to the four-month-long Middle East conflict have bolstered the broader market. The next test for the rally will be Micron's quarterly results on Wednesday. Shares of the memory chipmaker have risen almost 300% for the year.
A key focus this week will be on Thursday's personal consumption expenditures (PCE) data, the Federal Reserve's preferred gauge of core inflation. A hotter-than-expected reading is likely to reinforce expectations of a hawkish Federal Reserve after Chair Kevin Warsh underscored the need to curb inflation at last week's meeting.
Markets currently expect a 25-basis-point rate hike from the Fed in September, according to LSEG data. Yields on 2-year notes, which reflect near-term rate expectations, hit their highest level since early 2025 at 4.230% earlier in the day.
Comments from central bank speakers this week, including New York President John Williams and Chicago President Austan Goolsbee, will also be closely watched for policy signals.
Among other movers, Apogee Therapeutics (APGE.O), jumped nearly 47% after AbbVie said it would acquire the biotech for $10.9 billion in cash. AbbVie was up 4.7%.
Advancing issues outnumbered decliners by a 1.2-to-1 ratio on the NYSE and by a 1.49-to-1 ratio on the Nasdaq.
The S&P 500 posted 19 new 52-week highs and 19 new lows, while the Nasdaq Composite recorded 103 new highs and 74 new lows.
Reporting by Twesha Dikshit and Joel Jose in Bengaluru; Editing by Mrigank Dhaniwala and Maju Samuel
