S&P 500 notches 1st record high close in 2 years on AI bets

(Reuters) -- The S&P 500 posted a record high close on Friday for the first time in two years, fueled by a rally in chipmakers and other heavyweight technology stocks on optimism around artificial intelligence.

The benchmark's close confirmed that the S&P 500 has been in a bull market since it closed at its low on Oct. 12, 2022, according to one measure which also puts that date as the end of a bear market.

The S&P 500 lost nearly 25% in a sell-off between its record high close of 4,796.56 on Jan. 3, 2022 and the October 2022 low.

According to preliminary data, the S&P 500 gained 58.02 points, or 1.21%, to end at 4,838.96 points, while the Nasdaq Composite gained 251.51 points, or 1.70%, to 15,310.97. The Dow Jones Industrial Average rose 384.15 points, or 1.03%, to 37,852.76.

"It really is an encouraging day in terms of the action, and 4,800 certainly has been a key level which has been difficult to surmount. So if we continue to move in this direction, that's going to be a very positive sentiment sign," said Lisa Erickson, head of public markets at U.S. Bank Wealth Management in Minneapolis.

Semiconductor stocks Qualcomm, Marvell Technology, Nvidia and Microchip Technology gained after server maker Super Micro Computer lifted its second-quarter profit forecast, sending its shares soaring.

The Philadelphia SE Semiconductor index and S&P 500 information technology sector index hit record highs.

Microsoft and Apple, the world's two most valuable companies, also rose.

Chipmaker stocks have gained since Taiwan Semiconductor Manufacturing Company, the world's largest contract chipmaker, on Wednesday said it saw booming demand for high-end chips used in AI.

After surging through December, Wall Street treaded water in recent weeks as