(Recasts with preliminary close of trading)

* Software stocks weighed down by AppLovin ( APP ), Datadog ( DDOG ) results

* SpaceX finds footing as investors eye lockup expiry

* Key nonfarm payrolls data due on Friday

By Chuck Mikolajczak and Shashwat Chauhan

NEW YORK, Aug 6 (Reuters) - The Dow and S&P 500 indexes

closed lower on Thursday, pausing after a strong start to the

week, as investors digested the latest round of corporate

earnings and looked for signs of progress toward a peace deal

between the U.S. and Iran.

A robust earnings season, which has tempered some concerns

about the massive spending by AI-related companies, and growing

optimism over the potential end of hostilities in the Iran war

helped propel both the Dow Industrials and S&P 500 to record

highs earlier this week.

Oil prices rose, with U.S. crude settling up 2.75% at

$77.29 a barrel and Brent settling at $82.49 per barrel,

up 3.83%. Iran's semi-official Fars news agency reported that an

Iranian parliamentary committee is reviewing a preliminary bill

that would bar U.S., Israeli and other "hostile" vessels from

transiting the Strait of Hormuz.

"You're seeing perhaps more muted response to macro news

than you would otherwise see, probably due to the fact of the

summer and a little bit of fatigue, there's a little bit of

headline fatigue, specifically around Iran," said Robert

Bernstone, head of trading at SummitTX Capital in New York.

"Iran is having less of an impact right now, to be clear,

I'm not saying it has no impact ... tweets are something,

headlines are something, but we really want to see the devil is

in the details."

According to preliminary data, the S&P 500 lost 13.56

points, or 0.18%, to end at 7,709.99 points, while the Nasdaq

Composite lost 10.99 points, or 0.04%, to 26,352.45. The

Dow Jones Industrial Average fell 453.64 points, or

0.83%, to 53,895.48.

The recent indications of movement toward a peace deal

helped push crude prices lower earlier in the week and, in turn,

eased inflation worries and expectations for a rate hike from

the Federal Reserve, which also served to push U.S. Treasury

yields lower.

WESTERN DIGITAL ( WDC ), SANDISK DROP

Data storage company Western Digital ( WDC ) tumbled and memory

chip maker Sandisk ( SNDK ) dropped in the wake of quarterly

results. Both companies have surged this year, however, with

Sandisk ( SNDK ) up more than 400% and Western Digital ( WDC ) up about 160%.

AppLovin ( APP ) plunged after the marketing platform missed

Wall Street estimates for quarterly revenue, while Datadog ( DDOG )

plummeted after the cloud security firm said it expects

revenue growth to slow in the third quarter. Both stocks were

among the biggest drags on the benchmark S&P index.

Of the 382 companies in the S&P 500 that have reported

earnings through Wednesday morning, 84.8% have topped analyst

expectations, according to LSEG data, well above the 68% average

beat rate since 1994.

SPACEX LOCKUP PERIOD ENDS

SpaceX shares erased losses from earlier in the session

and closed higher, defying expectations that they would be

pressured by insider selling, as the lockup period for early

investors holding the stock expired.

On the data front, the number of Americans filing claims for

unemployment benefits increased slightly last week. The report

came ahead of closely watched nonfarm payrolls figures for July

due on Friday, which will shape expectations for the Fed's path

of interest rates at a time when Chairman Kevin Warsh has scaled

back on forward guidance from the central bank.