S&P 500, Nasdaq, hit record closing highs on AI optimism

STORY: It was a mostly upbeat Tuesday on Wall Street, despite a slight move downward for the Dow. The S&P 500 climbed about six-tenths of a percent and the tech-heavy Nasdaq added roughly 1.2%, with both indexes closing at record highs.AI-fueled optimism offset concerns over Middle East peace talks, which were compounded by recent U.S. strikes on Iran.:: MicronSemiconductor stocks continued to lead the charge, with Micron Technology soaring 19%, hitting $1 trillion in market value for the first time after UBS more than tripled its price target on the stock.But Matt Stucky, chief portfolio manager for equities at Northwestern Mutual Wealth Management, finds the narrowness of market gains concerning."Just to paint a picture of the contrast in the markets from pre-Iran conflict to post, if you look through the market for the first couple of months this year, 65% of companies were outperforming the index. Since the conflict commenced at the end of February, just 24% of companies are outperforming the S&P 500. [FLASH] Any time you see a market that becomes more narrow, as a portfolio manager, as an investor, you start to question the longevity and resilience of that market."Sticking with chip makers, shares of Qualcomm rose almost 4.5% after Bloomberg News reported the company reached a deal with TikTok owner ByteDance to supply chips. Elsewhere in the market, shares of AutoZone tumbled nearly 9% - despite the company reporting quarterly profit and revenue that beat estimates - as higher costs and inventory investments continued to pressure margins.