(Updates prices to US afternoon trading)

* Indexes: Dow up 0.78%, S&P down 0.34%, Nasdaq down 0.58%

* SpaceX surpasses Amazon's ( AMZN ) market value

* Investors await first Fed meeting under Warsh

* Financials lead S&P sector gainers, tech is biggest

laggard

By Sinéad Carew and Sruthi Shankar

June 16 (Reuters) - The Nasdaq Composite and the S&P 500

lost ground on Tuesday under pressure from technology stocks,

while the Dow Jones Industrial Average touched a record high and

SpaceX surpassed Amazon's ( AMZN ) market value to become the fifth-most

valuable U.S. company.

After rallying sharply on Monday on optimism about a

U.S.-Iran peace deal, investors in the S&P 500 and the Nasdaq

took a breather even as oil prices fell to their lowest levels

since early March.

Shares of SpaceX climbed more than 10%, helping the AI

and rocket company surpass Amazon's ( AMZN ) market value and

briefly top Microsoft's ( MSFT ) value as its blistering surge

continued after its initial public offering.

While falling oil prices offered some support to equities,

Mark Luschini, chief investment strategist at Janney Montgomery

Scott in Philadelphia, said building on steep gains in the

heavyweight technology sector was too difficult. Luschini said

investors are cautious ahead of the U.S. Federal Reserve's

policy update due on Wednesday afternoon.

"We had a big move yesterday in the market," said Luschini,

alluding to the S&P 500's 1.65% rally on Monday and Nasdaq's

advance of more than 3%. "We're just digesting some of those

gains and the setup in anticipation of the Fed meeting is always

a little tentative."

At 2:17 p.m. ET (1817 GMT), the Dow Jones Industrial Average

rose 403.66 points, or 0.78%, to 52,074.69 after marking

a record closing high on Monday. The S&P 500 lost 25.97

points, or 0.34%, to 7,528.32 and the Nasdaq shed 155.22

points, or 0.58%, to 26,528.72.

TECHNOLOGY LAGS, FINANCIALS RISE

Investors rotated into economically sensitive sectors and

sold richly valued technology stocks. Of the S&P 500's 11 major

sectors, technology was the biggest laggard, down

1.7%, while financials was the biggest gainer, up 1.4%,

followed by industrials' 1.2% advance.

Shares of JPMorgan Chase ( JPM ) climbed 3.4%, while Wells

Fargo ( WFC ) added 1.8% and Bank of America ( BAC ) added 1.6%.

U.S. oil futures slumped more than 6% as details of the

U.S.-Iran interim deal emerged on Tuesday, with U.S. President

Donald Trump saying it will rule out a nuclear weapon for Tehran

and a U.S. official saying it allows Iran to sell oil upon

signing.

The deal is expected to extend a tenuous ceasefire announced

in April by another 60 days and reopen the Strait of Hormuz,

which Iran has effectively blocked since the U.S. and Israel

attacked Iran in February.

The war had pushed up oil prices and fanned worries about sticky

inflation. Investors widely expect the Fed to hold interest

rates at the 3.50% to 3.75% range on Wednesday, though they will

pay close attention to new Fed Chairman Kevin Warsh's comments

on inflation, unemployment and the economic outlook.

Traders see the Fed holding rates through much of the year

while seeing a roughly 42% chance of a 25-basis-point rate hike

in December, according to CME Group's FedWatch tool.

Shares of Olin fell 6.4% after the chemical producer

said it would acquire Huntsman in an all-stock deal

valued at $2.43 billion. Huntsman shares tumbled 16.7% as the

offer stood at a discount to the stock's recent price.

Yum Brands ( YUM ) rose 1.9% after the fast-food company

said it would sell its Pizza Hut chain for $2.7 billion, as it

struggles with stiff competition and cautious consumer spending.

Advancing issues outnumbered decliners by a 1.21-to-1 ratio

on the NYSE, where there were 280 new highs and 69 new lows. On

the Nasdaq, 2,143 stocks rose and 2,610 fell as declining issues

outnumbered advancers by a 1.22-to-1 ratio. The S&P 500

posted 22 new 52-week highs and three new lows.

The Nasdaq Composite recorded 73 new highs and 102 new lows.