* Futures: Dow dips 0.08%, S&P 500 up 0.11%, Nasdaq up 0.66%

* Carmax ( KMX ) gains on Q1 revenue beat

* Chipmakers rebound after sell-off in previous session

* May retail sales jump 0.9% vs est 0.5%

* Fed decision awaited later in the day

(Updates with pre-open prices)

By Sruthi Shankar and Twesha Dikshit

June 17 (Reuters) - The S&P 500 and the Nasdaq were set to

open higher on Wednesday, as chip stocks rebounded ahead of the

first interest rate decision under new Federal Reserve Chair

Kevin Warsh.

Shares of richly valued chipmakers, including Broadcom ( AVGO )

, Micron Technology ( MU ), Advanced Micro Devices ( AMD )

and Intel ( INTC ), rose between 2.3% and 3.7% in

premarket trading, recovering from Tuesday's drop.

U.S. stocks have been choppy after a sharp rally on Monday

when President Donald Trump announced a preliminary U.S.-Iran

peace deal, which sent oil prices tumbling and eased inflation

fears.

Investors' focus is now on the Federal Reserve's monetary

policy decision, set to be released at 2:00 p.m. ET on

Wednesday.

Policymakers are widely expected to hold interest rates

unchanged at the 3.50%-3.75% range as they wrestle with

inflation pressures from higher oil prices fueled by the Middle

East war.

Investors will also keep a close watch on the new Fed

chair's first press conference for his views on inflation,

unemployment and the economic outlook.

The 10-year Treasury yield, the benchmark for global

borrowing costs, edged higher to 4.43%.

"The last thing that Warsh wants to do is send the 10-year

yield sharply higher. It's really important for markets for the

10-year yield to stay below 4.5, especially now that oil prices

are lower," said Jeff Buchbinder, chief equity strategist at LPL

Financial.

"So don't expect any fast moves along those lines. And of

course, he has to get the buy-in from the committee. So that

will be a very long, drawn-out process."

Data showed U.S. retail sales increased more than expected

in May, but a slowdown is likely as the cushion that consumers

had from larger tax refunds depletes due to rising costs.

Retail sales jumped 0.9% last month after a downwardly

revised 0.4% gain in April, the Commerce Department's Census

Bureau said, compared with economists' forecast of a rise of

0.5%.

Traders see the Fed holding rates through much of the year,

but are betting on a nearly 43% chance of a 25-basis-point rate

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

By 08:38 a.m. ET, S&P 500 e-minis were up 8 points,

or 0.11%, Nasdaq 100 e-minis added 198.5 points, or

0.66%, and Dow e-minis dipped 44 points, or 0.08%.

U.S. stocks have recovered from much of the early June

slump, with the blue-chip Dow touching record highs for

the past two consecutive sessions, as a resilient U.S. economy,

broadening of the rally beyond tech shares and falling oil

prices aided sentiment.

Oil prices hovered near a three-month low, fueled by hopes

that the interim peace deal between the United States and Iran

would allow oil to leave the Gulf through the crucial Strait of

Hormuz.

The memorandum of understanding, not yet public, extends by

another 60 days a tenuous ceasefire agreed in April, to allow

room for talks toward a permanent truce.

Still, some uncertainty lingered after Trump said the Iran

memorandum of understanding was not final, and he could resume

bombing if he did not like it.

Shares of Elon Musk's AI and rocket company SpaceX

rose 3.1% after surpassing Amazon's ( AMZN ) market value on

Tuesday to become the fifth most valuable company.

CME Group ( CME ) slipped almost 3% after the exchange

operator said its CEO, Terry Duffy, will step down on March 1,

and transition to the role of executive chairman.

Carmax ( KMX ) added 1.7% after reporting

better-than-expected first-quarter revenue.

(Reporting by Sruthi Shankar and Twesha Dikshit in Bengaluru;

Editing by Shinjini Ganguli)