*

Reddit ( RDDT ) gains on OpenAI partnership

*

GameStop ( GME ) expects Q1 revenue to drop, shares tumble

*

AMD up as Microsoft ( MSFT ) offers AMD option to Nvidia AI

processors

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Indexes mixed: Dow up 0.34%, S&P up 0.12%, Nasdaq down

0.07%

(Updates to 4:20 PM)

By Chibuike Oguh and Shristi Achar A

NEW YORK, May 17 (Reuters) -

The Dow Jones industrial average closed above the 40,000

mark for the first time on Friday, with other major indexes also

scoring weekly gains, as data supported expectations for

interest rate cuts by the Federal Reserve this year.

The benchmark S&P 500 edged higher after paring

losses while the Nasdaq fell, but both chalked up a

fourth straight week of gains. The Dow rose to end the

fifth week of advances in a row.

Strong corporate results and inflation and other economic

data have bolstered investor hopes for Fed rate cuts this year.

Eight out of the 11 S&P 500 sectors advanced, with energy

leading gains while technology was the biggest

loser. For the week, Dow gained 1.24%, S&P 500 rose 1.54%, and

Nasdaq climbed 2.11%.

"Today is a bit of a digestion day: we just broke out

through record highs and now we're on a fourth straight week of

gains, and the market appears to take a breaker," said Keith

Lerner, co-chief investment officer at Truist Advisory Services

in Atlanta.

Traders see a 68% chance of the Fed's first rate cut in

September, the CME FedWatch Tool showed.

The Dow Jones Industrial Average rose 134.21 points,

or 0.34%, to 40,003.59, the S&P 500 gained 6.17 points,

or 0.12%, to 5,303.27 and the Nasdaq Composite lost

12.35 points, or 0.07%, to 16,685.97.

"For all the times that I've seen the market hit milestones

and new highs, there's almost always consolidation around it

even though it seems it's all psychological," said Tom Plumb,

chief executive and portfolio manager at Plumb Funds in Madison,

Wisconsin.

"People have got mixed signals on inflation this week and

the next big catalyst is next week when Nvidia ( NVDA ) reports. So it's

one of those days when you seem to be biding your time."

Advanced Micro Devices ( AMD ) gained 1.1% after Microsoft ( MSFT )

said it plans to offer its cloud computing customers a

platform of AMD artificial intelligence chips that will compete

with components made by Nvidia ( NVDA ).

Reddit ( RDDT ) rose 10% following a partnership with OpenAI

to bring its content to ChatGPT.

GameStop ( GME ) dropped nearly 20% after filing for a

mixed-shelf offering and saying it expects first-quarter net

sales to drop from a year ago.

About 15.6 billion shares changed hands across U.S.

exchanges, compared with an average of about 11.7 billion shares

over the last 20 sessions.

Advancing issues outnumbered decliners by a 1.18-to-1

ratio on the NYSE. On the Nasdaq, 2,039 stocks rose and 2,221

fell as declining issues outnumbered advancers by a 1.09-to-1

ratio.

The S&P 500 posted 45 new 52-week highs and one new low

while the Nasdaq recorded 157 new highs and 68 new lows.