US stocks flat mid-session after a positive start; chipmakers slide, CarMax and GMS rally on earnings and M&A buzz

US stocks traded flat in Friday's mid-session as investors weighed Federal Reserve policy signals and monitored escalating tensions in the Middle East. The S&P 500 dipped 0.1 percent, the Nasdaq Composite fell 0.4 percent, while the Dow Jones Industrial Average edged up 73 points, or 0.2 percent.

Chip stocks faced pressure after a Wall Street Journal report suggested the US might revoke technology waivers for semiconductor manufacturers like Samsung, SK Hynix, and Taiwan Semiconductor Manufacturing. Nvidia dropped over 1 percent, Broadcom and Taiwan Semiconductor fell more than 2 percent, and the VanEck Semiconductor ETF (SMH) declined nearly 2 percent.

Federal Reserve Governor Christopher Waller's comments on CNBC's "Squawk Box" boosted early market optimism, hinting at possible rate cuts as early as July. However, Fed Chair Jerome Powell's data-dependent stance and President Donald Trump's ongoing criticism of Powell for delaying rate cuts tempered expectations. Trump also signaled a decision on potential US involvement in an Israeli strike on Iran within two weeks, adding geopolitical uncertainty. Oil prices eased, with Brent down over 2 percent, while US crude saw slight gains.

In corporate news, GMS surged 28 percent amid a reported bidding war between QXO and Home Depot, lifting related building stocks like Bluelinx Holdings (+9 percent) and Installed Building Products (+4 percent). CarMax jumped 10 percent after beating Q1 earnings expectations, reporting $1.38 per share against a forecast of $1.16. Darden Restaurants gained nearly 3 percent following a strong Q4 and a new $1 billion share repurchase program. Tesla rose nearly 2 percent ahead of its robotaxi pilot launch in Austin, despite calls from Texas lawmakers to delay until September.