(Reuters) -The S&P 500 and the Nasdaq dipped on Tuesday as concerns around elevated technology valuations resurfaced, while markets closely watched progress toward the end of the longest government shutdown in U.S. history.

Nvidia shares dropped 3.7% after Japanese technology investor SoftBank Group disclosed that it had offloaded its shares in the AI bellwether for $5.83 billion.

Nvidia-backed CoreWeave's shares dropped 12.7% after the cloud computing firm trimmed its annual revenue forecast due to data center hiccups. Shares of Core Scientific fell 7%.

"There's a little bit of weakness on a few AI-related headlines ... a lot of really minor kinks in the armor, but it comes amid kind of a broader consolidation in those names that started last week," said Ross Mayfield, investment strategist at Baird.

"(With) uncertainty around how big this technology can be, on a given day it's going to be very sentiment driven which usually tends to add some volatility to the markets."

AI-related companies have been the main drivers of the bull market this year but worries over monetary returns and circular expenditure prompted a sell-off last week.

On Monday, technology and AI shares rebounded, with the Nasdaq posting its largest daily gain since May 27 on expectations that the government could reopen this week. The prolonged closure has weighed on the economy and contributed to a data blackout.

Further dampening sentiment, a weekly update of ADP's preliminary payroll figures showed that private employers shed an average of 11,250 jobs a week for the four weeks ended October 25.

At 11:53 a.m. ET, the Dow Jones Industrial Average rose 290.54 points, or 0.61%, the S&P 500 lost 14.37 points, or 0.21%, and the Nasdaq Composite lost 178.17 points, or 0.76%.

Information technology stocks were the biggest drag on the S&P 500, down 1.2%, while the Philadelphia SE Semiconductor index fell 2%.

Health stocks rose 1.6%, with drugmakers Eli Lilly, Merck and Amgen up between 2.1% and 3.6%.

Occidental Petroleum gained 2.8% after the shale producer beat third-quarter profit expectations. The S&P 500 energy index added 1.6%.

Gains in Amgen and Goldman Sachs helped the Dow.

FEDERAL RE-OPENING AWAITED

The U.S. Senate on Monday approved a compromise that would end the shutdown that has led to widespread disruptions to air travel and food benefits and left federal workers unpaid.

The bill will head next to the House of Representatives for approval before being sent to U.S. President Donald Trump for his signature, with betting markets like Polymarket fully pricing in a reopening this week.

Meanwhile, Trump said the U.S. faced an economic and national security disaster if the Supreme Court ruled against his use of an emergency powers law to impose sweeping tariffs.

Among other movers, Paramount Skydance gained 9.8%, topping the S&P 500, after the newly merged media firm announced more cost cuts and plans to invest $1.5 billion in its streaming and studio divisions.

U.S. bond markets were closed for a public holiday.

Advancing issues outnumbered decliners by a 1.63-to-1 ratio on the NYSE and by a 1.02-to-1 ratio on the Nasdaq.

The S&P 500 posted 22 new 52-week highs and two new lows, while the Nasdaq Composite recorded 75 new highs and 106 new lows.

(Reporting by Twesha Dikshit and Purvi Agarwal in Bengaluru; Editing by Maju Samuel)

By Twesha Dikshit and Purvi Agarwal