The S&P 500 and the Nasdaq rose solidly after a shaky start on Monday, as technology stocks found their footing following last week's AI-sparked sell-off, while investors waited for key economic data that could shed light on the US Federal Reserve's interest-rate path.

While the Dow notched its second closing record in a row with a small gain, the S&P 500 ultimately finished short of its closing record.

The S&P 500 technology sector finished up 1.6 percent to extend Friday's gains after a steep sell-off last week.

The S&P 500 Software Services index ended up 2.9 percent as it clawed back some losses for a second day after a bruising seven days of losses fuelled by fears that AI could intensify competition.

One big gainer in software was Oracle, which added 9.6 percent after DA Davidson upgraded it to a "buy" recommendation from "neutral."

Along with the upgrade, Keith Lerner, chief investment officer at Truist Advisory Services, said another support for technology stocks came from comments CNBC attributed to Sam Altman, the CEO of Microsoft-backed OpenAI.

Altman told employees that the start-up's artificial intelligence ⁠chatbot, ChatGPT, was back to exceeding 10 percent monthly growth, according to CNBC's report which Reuters could not independently verify.

"You've a sharply oversold market where a little bit of good news can go a long way," said Lerner, adding that "the rubber band was stretched too far for tech and software" in last week's sell-off.

While the software index was still almost 13 percent below its trading levels just before the exodus that started in late January, the broader tech sector was less than 3 percent under its pre-sell-off levels.

After surpassing 50,000 points for the first time on Friday, the Dow rose less than 0.1 percent, to 50,135.

The S&P 500 rose 0.5 percent, to 6,964, while the Nasdaq rose 0.9 percent, to 23,238. (Reuters)