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U.S. retail sales rise less than expected in May

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Lennar ( LEN ) drops as home delivery forecast disappoints

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Citigroup hikes S&P 500 year-end target to 5,600 points

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Indexes: Dow up 0.03%, S&P up 0.12%, Nasdaq down 0.11%

(Updated at 11:55 a.m. ET/1555 GMT)

By Lisa Pauline Mattackal and Ankika Biswas

June 18 (Reuters) -

The Dow and the S&P 500 inched up on Tuesday with investors

focusing on softer-than-expected U.S. retail sales numbers and

commentary from a slew of Federal Reserve officials throughout

the day, though trading was subdued ahead of a market holiday.

Data showed U.S. retail sales rose 0.1% in May, versus the

0.3% increase expected by economists polled by Reuters, while a

separate report showed May industrial production and

manufacturing output both beat expectations.

Markets slightly increased bets on two interest rate cuts

from the Fed this year following the data, according to LSEG's

FedWatch, clashing with the most recent projections from

policymakers showing they broadly expect just one interest rate

cut this year.

"The May retail sales report may have threaded the

needle, delivering investors a soft reading without being too

weak ... this is a good thing for the Fed and those who are

looking for rate cuts later this year," said Bret Kenwell, U.S.

investment analyst at eToro.

Chip stocks continued their recent rally, boosting the

Philadelphia SE Semiconductor index to a record high.

Nvidia ( NVDA ), Qualcomm ( QCOM ), Arm Holdings and

Micron were up between 2.7% and 4.5%, with Micron hitting

a record high.

The Nasdaq inched lower after six consecutive record closing

highs, with losses in Alphabet, Amazon ( AMZN ) and

Meta Platforms ( META ) offseting chip stock gains.

Markets are shut on Wednesday for the Juneteenth holiday.

Energy was the top S&P 500 sector gainer, up 1.5%,

while communication services was the worst hit.

Focus is also on comments from several Fed officials

throughout the day. New York Fed President John Williams said

rates will come down gradually over time, while Richmond Fed's

Thomas Barkin said he required more months of economic data

before supporting a rate cut.

Hopes for multiple rate cuts this year, enthusiasm for

AI-linked companies and strong earnings from other tech firms

have supported equities over the past months, though gains have

been largely driven by a few heavily weighted stocks.

However, weakening data has also started to raise

concerns about the economy's underlying health.

"If it's bad economy news, we're going to get a rate cut

which is good for stocks ... but it could actually mean bad news

for companies," said Robert Pavlik, senior portfolio manager at

Dakota Wealth Management.

Citigroup raised the year-end target for the S&P 500

to 5,600 points from 5,100.

At 11:55 a.m. ET, the Dow Jones Industrial Average

was up 12.52 points, or 0.03%, at 38,790.62, the S&P 500

was up 6.61 points, or 0.12%, at 5,479.84, and the Nasdaq

Composite was down 20.08 points, or 0.11%, at 17,836.94.

Edtech company Chegg ( CHGG ) jumped 14.5% after announcing

job cuts as part of a restructuring plan.

Homebuilder Lennar ( LEN ) fell 4.6% after forecasting

lower-than-expected third-quarter home deliveries.

Advancing issues outnumbered decliners by a 1.92-to-1 ratio

on the NYSE and by a 1.07-to-1 ratio on the Nasdaq.

The S&P index recorded 41 new 52-week highs and two new

lows, while the Nasdaq recorded 49 new highs and 128 new lows.