*

Advancing chipmakers help lift Nasdaq

*

Walt Disney ( DIS ) gains after Barclays upgrade

*

Boeing ( BA ) CEO to step down in shakeup amid safety crisis;

shares up

*

Indexes: Dow down 0.4%, S&P off 0.13%, Nasdaq up 0.5%

(Updated at 2:15 p.m. ET/ 1815 GMT)

By Chuck Mikolajczak

NEW YORK, March 25 (Reuters) -

The Dow and S&P 500 slipped on Monday, the first session

after the biggest weekly percentage gains for the indexes this

year, as investors assessed the likely path of interest rates

from the Federal Reserve ahead of key inflation data due later

in this holiday-shortened week.

Last week, the Fed maintained its guidance for three

interest-rate cuts this year, and the S&P 500 and Dow had strong

gains while the Nasdaq notched its biggest weekly percentage

gain since mid-January.

On Monday, Chicago Fed President Austan Goolsbee said he

had penciled in three rate cuts for this year, while Fed

Governor Lisa Cook said the central bank needs to proceed with

caution as it decides when to start cutting interest rates.

"It's a breather, the market has held really well, so people

are waiting, there's a lot of people waiting for that pullback,"

said Joe Saluzzi, partner, co-founder and co-head of equity

trading at Themis Trading in Chatham, New Jersey.

"What the Fed did was give the all clear for now, it's

really interesting what they are doing. They're not cutting

anything yet they just keep delaying it and the market is fine

with that... but they're doing a good job right now of saving

the bullets when they need them."

The Dow Jones Industrial Average fell 155.93

points, or 0.40%, to 39,319.97, the S&P 500 lost 6.73

points, or 0.13%, to 5,227.45 and the Nasdaq Composite

gained 7.30 points, or 0.05%, to 16,436.71.

Economic data showed sales of new U.S. single-family homes

fell unexpectedly in February after mortgage rates increased

during the month, but the underlying trend remained strong amid

a chronic shortage of previously owned houses on the market.

The Nasdaq eked out a small gain thanks to a turnaround

in semiconductor stocks. Chip shares were initially weaker after

a report over the weekend said

China had introduced guidelines

to phase out U.S. microprocessors supplied by Intel ( INTC )

and AMD from government personal computers and

servers.

The Philadelphia Semiconductor Index rose 0.5%,

led by a 8.46% surge in Micron Technology ( MU ) to a record

high, while industry heavyweight Nvidia ( NVDA ) climbed 1.89%.

Intel ( INTC ) was down 1.15% while AMD, erasing earlier

declines, was up 0.66%.

Expectations for a rate cut from the Fed in June are again

increasing, with markets now pricing in a 71.9% chance for a cut

of at least 25 basis points (bps), according to CME's FedWatch

Tool, up from around 54.7% a week ago.

The crucial February reading of the Personal Consumption

Expenditures (PCE) price index, the Fed's preferred inflation

gauge, is due on Friday, when U.S. markets will be shut for the

Good Friday holiday.

A hot reading for the PCE index could dent market optimism

around early rate cuts.

Boeing ( BA ) pared gains and was last up 1.39% after it

announced a broad management shakeup and said CEO Dave Calhoun

would step down from his position at the end of 2024.

Walt Disney ( DIS ) gained 2.43% after Barclays upgraded

the stock to "overweight" from "equal weight".

Declining issues outnumbered advancers on the NYSE a

1.03-to-1 ratio while on the Nasdaq declining issues outnumbered

advancers by about a 1.08-to-1 ratio.

The S&P 500 posted 31 new 52-week highs and 2 new lows while

the Nasdaq recorded 107 new highs and 96 new lows.