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Deere falls on annual forecast cut

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Walmart ( WMT ) rises on annual forecast raise

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US weekly jobless claims fall

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Indexes up: Dow 0.28%, S&P 0.25%, Nasdaq 0.21%

(Updated at 11:28 a.m. ET/ 1528 GMT)

By Bansari Mayur Kamdar and Shristi Achar A

May 16 (Reuters) - The Dow crossed the 40,000 level for

the first time on Thursday, notching a fresh all-time high and

leading Wall Street gains a day after tepid inflation data

bolstered hopes of interest-rate cuts.

The blue-chip index has recovered nearly 40% from its

October 2022 lows, powered by strong quarterly results and

rising bets of interest rate cuts by the Federal Reserve.

"The Dow is seen as 'Main Street America' and media across

this country and global media reference the Dow," said Quincy

Crosby, chief global strategist at LPL Financial.

"What (the 40,000 milestone) means is that regardless of the

concerns about inflation and consumer sentiment, the companies

in the Dow, which represent a cross-section of our economy,

continue to march higher on better earnings and stronger

guidance."

All three major indexes notched record closes in the

previous session after a smaller-than-expected rise in consumer

inflation fueled optimism that inflation was easing after three

months of hotter numbers.

The market is back to betting on two quarter-point interest

rate cuts from the Federal Reserve this year, with traders

seeing a 70% chance of the first reduction in September,

according to the CME FedWatch Tool.

On the economic front, data showed the number of Americans

filing new claims for jobless benefits fell 10,000 to a

seasonally adjusted 222,000 for the week ended May 11.

Inflation is still not where the Fed needs it to be, with

companies in the service sector continuing to feel they have

pricing power, Richmond Federal Reserve president Thomas Barkin

said.

Among earnings updates, Walmart ( WMT ) rose 5.8% after the

retail giant raised its fiscal 2025 sales and profit forecast,

betting on easing inflation to further boost demand for

essentials.

That helped consumer staples lead sectoral

advances with a 1.6% gain.

Deere fell 3.2% after the farm equipment maker

trimmed its annual profit forecast for the second time.

At 11:28 a.m. ET, the Dow Jones Industrial Average

was up 112.55 points, or 0.28%, at 40,020.55, the S&P 500

was up 13.11 points, or 0.25%, at 5,321.26, and the Nasdaq

Composite was up 35.67 points, or 0.21%, at 16,778.06.

Most megacap growth and technology stocks climbed, with

Nvidia ( NVDA ) leading gains.

U.S.-listed shares of Chubb added 3.6% after Warren

Buffett's Berkshire Hathaway ( BRK/A ) revealed a stake worth

$6.7 billion in the insurer.

Popular meme stocks GameStop ( GME ) and AMC Entertainment ( AMC )

slid 23.1% and 13.5%, respectively.

They were set to extend Wednesday's losses that followed a

two-day rally sparked by the return of "Roaring Kitty" Keith

Gill, the central figure in the 2021 meme stock frenzy.

Declining issues outnumbered advancers for a 1.01-to-1 ratio

on the NYSE and by a 1.03-to-1 ratio on the Nasdaq.

The S&P index recorded 53 new 52-week highs and one new low,

while the Nasdaq recorded 65 new highs and 34 new lows.