(Updates with late afternoon prices, analyst quote in paragraph

10)

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Indexes: Dow down 0.4%, S&P 500 down 0.09%, Nasdaq down

0.06%

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Chip companies face revenue-sharing demand from US

government

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Intel ( INTC ) CEO to visit White House, report says

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TKO Group ( TKO ) up after $7.7-billion US rights deal for UFC

By Johann M Cherian, Sanchayaita Roy and Saeed Azhar

Aug 11 (Reuters) - Wall Street's main indexes were down

on Monday as investors await inflation data this week and chip

companies seesawed after agreeing to share a portion of revenue

from China sales with the U.S. under a trade policy shift from

the Trump administration.

Nvidia ( NVDA ) was flat after reversing premarket losses,

and Advanced Micro Devices ( AMD ) was up 0.5% in volatile

trading. A U.S. official told Reuters the semiconductor majors

had agreed to give the United States government 15% of revenue

from sales of their advanced chips to China.

Analysts said the levy could hit the chipmakers' margins and set

a precedent for Washington to tax critical U.S. exports,

potentially extending beyond semiconductors.

"A lot of people are not sure what to make of that because

this is the first time in history that it's ever happened where

an administration wants a percentage of the profits from a

publicly traded company," said Michael Matousek, head trader at

U.S. Global Investors.

Enabling semiconductor sales to China was an integral issue in

the agreement Washington and Beijing signed this year, which

expires on Tuesday. U.S. President Donald Trump lauded China's

cooperation in talks at a White House press conference on

Monday.

At 2:01 p.m. ET (1801 GMT), the Dow Jones Industrial Average

fell 176.88 points, or 0.40%, to 43,998.91, the S&P 500

lost 5.60 points, or 0.09%, to 6,383.93, and the Nasdaq

Composite lost 12.87 points, or 0.06%, to

21,437.15.

Traders took a step back after the S&P 500 and the

Nasdaq last week logged their strongest weekly

performances in more than a month. On Monday, the tech-heavy

Nasdaq was on track for its third consecutive record closing

high, if gains hold.

Investors expect the recent shakeup at the U.S. Federal

Reserve and signs of labor market weakness could nudge the

central bank into adopting a dovish monetary policy stance later

this year, fueling much of the optimism.

July's consumer inflation report is due on Tuesday, and

investors anticipate that the Fed will lower borrowing costs by

about 60 basis points by December, according to data compiled by

LSEG.

"Markets are on rate watch, so anything inflation-related

will move markets this week," said Jamie Cox, managing partner

at Harris Financial Group. "It's all about three rate cuts

versus two at this point."

Citigroup and UBS Global Research became the latest brokerages

to raise their year-end targets for the benchmark S&P 500.

Micron Technology ( MU ) raised its forecast for fourth-quarter

revenue and adjusted profit, boosting its shares 3%.

Intel ( INTC ) was up 3.5% after a report said CEO Lip-Bu Tan

was expected to visit the White House. Trump had called for his

removal last week.

TKO jumped 8.5% after Paramount bought the

rights from the live entertainment company to exclusively

distribute UFC events for the next seven years in a deal valued

at around $7.7 billion.

Trump is expected to meet Russia's President Vladimir Putin

on Friday to try and negotiate an end to Russia's war on

Ukraine.

Declining issues outnumbered advancers by a 1.11-to-1 ratio

on the New York Stock Exchange. There were 203 new highs and 89

new lows on the NYSE.

On the Nasdaq, declining issues outnumbered advancers by a

1.12-to-1 ratio.

The S&P 500 posted 14 new 52-week highs and 15 new lows,

while the Nasdaq Composite recorded 65 new highs and 98 new

lows.