* Futures mixed: Dow down 0.1%, S&P 500 up 0.2%, Nasdaq up

0.7%

* Levi Strauss falls after Q2 results

* Meta slips after report of AI chip production set for

September

(Updates prices, details)

By Ragini Mathur and Avinash P

July 9 (Reuters) - S&P 500 and Nasdaq futures edged higher

on Thursday as gains in chip stocks helped offset renewed

geopolitical jitters after fresh U.S. strikes on Iran threatened

to prolong a four-month conflict and keep markets volatile.

The U.S. military said on Wednesday it had launched new

strikes on Iran to keep the Strait of Hormuz open to shipping.

Iran responded with attacks on Kuwait and Bahrain, deepening a

confrontation that risks derailing already fragile ceasefire

efforts.

The escalation came hours after President Donald Trump said

he believed an interim ceasefire with Iran was "over."

Oil futures were volatile, last rising about 1% after easing

earlier in the session. Prices had climbed to two-week highs on

Wednesday following Trump's remarks.

"The path toward a lasting peace deal is likely to be bumpy,

with periodic flare-ups in tensions potentially triggering bouts

of market volatility. But we also believe that both sides remain

incentivized to keep the Strait of Hormuz open," said Mark

Haefele, chief investment officer at UBS Global Wealth

Management.

In premarket trading, IBM ( IBM ) and Microsoft ( MSFT )

fell 3.8% and 1.5%, respectively. A report said Starbucks ( SBUX )

had tapped AI to reduce its reliance on both companies.

The declines weighed on Dow futures.

Other software shares also slipped, with ServiceNow ( NOW )

and Adobe down 3.8% and 3%, respectively.

Meta Platforms ( META ) fell 1.2% after Reuters reported

citing an internal memo that the company plans to make an

artificial intelligence chip from September.

Chip stocks provided some support to futures, with the

iShares Semiconductor ETF gaining 2.4%.

Still, sentiment toward AI-linked stocks has come under

pressure in recent sessions amid concerns about the durability

of a rally that has helped drive Wall Street gains this year,

while Middle East tensions simmered in the background.

At 7:36 a.m. ET, Dow E-minis were down 69 points, or

0.13%, and S&P 500 E-minis were up 11.25 points, or

0.15%. Nasdaq 100 E-minis were up 198.5 points, or

0.67%.

The renewed tensions forced stock investors to reassess

recent optimism that an eventual resolution could support risk

assets. The S&P 500 and Dow ended Wednesday's

session lower, while the Nasdaq eked out a marginal

gain.

Under new Chair Kevin Warsh, the Federal Reserve kept

interest rates unchanged at its June meeting, but minutes

released on Wednesday showed a few policymakers saw a case for

raising borrowing costs before ultimately agreeing to hold

steady.

"While policymakers are likely to maintain their hawkish

stance for a while longer, the rhetoric should start to soften

once they are more confident that second-round inflation effects

are limited," Haefele said.

Traders are pricing in at least one 25-basis-point rate hike

by the end of the year, according to LSEG data.

Investors will watch the weekly jobless claims report at

8:30 a.m. ET for further clues on the health of the economy,

while New York Fed President John Williams is scheduled to speak

later in the day.

Levi Strauss slipped 4.4%, even after the denim

maker raised its annual sales forecast.