* U.S. equities choppy with Nasdaq lagging

* Chip index rises while software index sinks

* AT&T ( T ) jumps after strong wireless subscriber additions in

Q2

* Alphabet, Tesla to report Q2 results after the bell

(Adds preliminary closing prices)

By Sinéad Carew and Ragini Mathur

July 22 (Reuters) - The S&P 500 and the Nasdaq closed lower

on Wednesday with a mixed performance from technology stocks, as

investors waited for key earnings reports to gauge the health of

a market rally fed by enthusiasm for artificial intelligence.

After months of gains that lifted the major indexes from

their March lows, momentum has been wobbling with uneven trading

in heavyweight semiconductor stocks and weakness in software

stocks.

The Philadelphia SE Semiconductor index ended higher,

after bouncing off early losses. The index was angling for its

third straight day of gains after three days of losses that had

confirmed it was in a bear market last week.

Investors were preparing for second-quarter results from

Alphabet and Tesla, the first of the

so-called "Magnificent Seven" megacap companies to report after

the bell for fresh evidence that these companies'

multibillion-dollar investments in AI are paying off.

"Investors have become a lot more discerning and specific as

to where they're choosing to invest in the AI trade," said Kevin

Gordon, head of macro research and strategy at Charles Schwab ( SCHW ).

Gordon noted that software stocks fell while chip stocks rose

during the session.

Trading was choppy in Alphabet, which will be under scrutiny

after a delay in the launch of a model central to its AI

ambitions. Texas Instruments ( TXN ), also due to report after

the close, ticked higher during the session.

According to preliminary data, the S&P 500 lost 10.72

points, or 0.14%, to end at 7,498.48 points, while the Nasdaq

Composite lost 145.48 points, or 0.56%, to 25,691.72.

The Dow Jones Industrial Average rose 1.52 points to

52,226.16.

The crowded earnings calendar leaves markets vulnerable to

sharper swings this week, while geopolitical tensions added

another layer of caution.

Crude oil futures recorded their highest settlement since

June 11, up around 3% on the day as Yemen's Iran-backed Houthi

militia threatened shipping in the Red Sea, one of the world's

most important energy chokepoints along with the Strait of

Hormuz.

U.S. President Donald Trump vowed on Wednesday to destroy an

Iranian bridge or power plant every time Iran shoots at a ship

in the strait.

"Excluding the megacap AI trade, there's an element of

what's going on with oil that's driving the market," said

Schwab's Gordon, noting that high oil prices are fanning

inflation worries. "People are being defensive with utilities,

but with energy and materials being higher, that's the inflation

component."

The Federal Reserve is expected to keep interest rates

steady for the rest of 2026, according to the median forecast in

a Reuters poll of economists. Still, respondents said the risk

of a rate hike remained elevated.

Traders are pricing in a roughly 66% chance the Fed leaves

rates unchanged at next week's meeting, CME Group's FedWatch

tool showed.

Shares in Super Micro Computer ( SMCI ) rallied sharply

after the server maker said it had secured more than $60 billion

in new orders in the fourth quarter. Peers Dell Technologies ( DELL )

and Hewlett Packard Enterprise ( HPE ) also climbed

after Super Micro reported upbeat preliminary results.

Among other movers, AT&T ( T ) advanced after the telecom

firm added more wireless subscribers than expected in the second

quarter. Philip Morris International ( PM ) shares rose after

stronger cigarette demand helped the company beat quarterly

results estimates.