* Nvidia ( NVDA ) gains on unveiling new chip to bring AI to

laptops

* Micron shares top $1,000 for the first time

* Jobs report, Broadcom ( AVGO ) results on deck this week

(Updates to market close)

By Stephen Culp and Medha Singh

NEW YORK, June 1 (Reuters) - Wall Street stocks posted

modest gains on Monday as investors watched developments in

U.S.-Iran peace negotiations and cheered the unveiling of a new

computer chip that promises to bring artificial intelligence to

personal computing.

Tech shares boosted the Nasdaq and the S&P 500 to their

latest in a series of record closing highs.

U.S. President Donald Trump said talks with Iran continue.

Earlier, Iran's news agency announced Tehran is halting indirect

negotiations with Washington after a new round of strikes

threatened to derail diplomatic efforts to end the war, now in

its fourth month.

The intensification of hostilities sent crude prices

jumping, along with worries over the extent to which a

protracted war could result in heightened, intransitory

inflation.

"We don't really know where things stand," said Thomas

Martin, senior portfolio manager at GLOBALT in Atlanta. "The

market seems to think that something's going to get done at some

point, but we don't have very good information to go on, like

what the Iranians really want and what Trump is willing to

settle for."

Stocks added to their gains after Trump said no Israeli

troops would go into Beirut, citing a call with Israeli Prime

Minister Benjamin Netanyahu.

Nvidia ( NVDA ) jumped after the company unveiled a new chip

that puts AI capabilities directly into personal computers.

The chip is the result of a three-year partnership with

Microsoft ( MSFT ) to "reinvent the PC" for the AI era, Nvidia ( NVDA )

CEO Jensen Huang said. Microsoft ( MSFT ) shares rose.

The reaction among semiconductor stocks was mixed. Qualcomm ( QCOM )

tumbled and while Intel ( INTC ) also fell. Micron

shares rose sharply, breaching the $1,000 mark for the

first time.

The Philadelphia SE Semiconductor Index advanced.

In economic news, U.S. factory activity expanded in May for

the fifth consecutive month as goods-makers navigate tariff and

geopolitical crosswinds.

Investors will turn to Friday's jobs report ahead of Kevin

Warsh's debut policy meeting as chairman of the U.S. Federal

Reserve this month, amid fears of rising inflation linked to the

Iran war that could upend the stock market rally.

According to preliminary data, the S&P 500

gained 20.19 points, or 0.27%, to end at 7,600.03 points,

while the Nasdaq Composite gained 114.75 points, or

0.43%, to 27,087.37. The Dow Jones Industrial Average

rose 44.70 points, or 0.09%, to 51,076.85.

Software stocks rebounded from heavy selling earlier this

year on AI disruption fears. ServiceNow ( NOW ) and IBM ( IBM )

rose sharply. The software services index advanced.

"On the software side, companies that hadn't been doing very

well, but now are doing well today," Martin added. "Some of that

has been attributed to Nvidia ( NVDA ) comments that software is part of

the solution, so the market's coming back to" software stocks.

Cadence Design Systems ( CDNS ) jumped after launching an

Nvidia ( NVDA )-powered AI agent for chip design.

Broadcom's ( AVGO ) earnings, due on Wednesday, will be

closely parsed in the wake of solid results from Dell

last week, which signaled strong AI server demand.