US STOCKS-S&P 500 jumps to first record high in 2 years on AI optimism

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Super Micro Computer's rosy outlook drives chip stocks

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Insurer Travelers rises on higher Q4 profit

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Spirit Airlines mulls options to refinance debt, shares gain

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Indexes: S&P 500 +1.00%, Nasdaq +1.30%, Dow +0.89%

(Updated at 1:45 p.m. ET/1845 GMT)

By Noel Randewich and Johann M Cherian

Jan 19 (Reuters) -

The S&P 500 surged to an intra-day record high on Friday for the first time in two years, fueled by gains in chipmakers and other heavyweight technology stocks on optimism around artificial intelligence.

The U.S. stock market benchmark jumped 1% to 4,828.56 points, beating its previous intra-day high of 4,818.62 points, recorded on Jan. 4, 2022. The gains erased the last of a more than 20% sell-off that stretched nine months into October 2022.

"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.

The Nasdaq gained 1.30% to 15,251.96 points, while the Dow Jones Industrial Average was up 0.89% at 37,802.11 points.

Semiconductor stocks Qualcomm, Marvell Technology, Nvidia and Microchip Technology gained each jumped more than 2% after server maker Super Micro Computer lifted its second-quarter profit forecast, sending its shares surging over 30%.

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, rose 0.7% and 1.3%, respectively.

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 investors reined in expectations the Federal Reserve would start cutting interest rates as soon as March.

Interest rate traders now see a 52% chance of a March rate cut, according to the CME Group's FedWatch Tool.

Adding to optimism on Friday, the University of Michigan's preliminary survey showed consumer sentiment improved in January to its highest level since the summer of 2021.

Travelers Cos jumped 5.6% after the insurer's fourth-quarter profit more than doubled, while State Street advanced 2%, after the lender reported record net inflows in its Global Advisors unit in the fourth quarter.

Spirit Airlines rebounded over 20% from losses earlier this week as it assessed options to refinance its 2025 debt maturities amid concerns over the airline's ability to remain afloat.

iRobot slumped over 25% after a report said the European Union's competition watchdog plans to block Amazon.com's $1.4-billion acquisition of the robot vacuum maker.

Advancing issues outnumbered falling ones within the S&P 500 by a 2.3-to-one ratio. (Reporting by Johann M Cherian and Ankika Biswas in Bengaluru; Additional reporting by Siddarth S; Editing by Pooja Desai and David Gregorio)