* Dow up 0.02%, S&P 500 down 0.16%, Nasdaq down 0.47%

* US consumer spending, core PCE inflation firmer in

January

* Meta down 3%; report says AI model 'Avocado' rollout

pushed to May or later

* Adobe falls 6.6% after CEO Shantanu Narayen to leave

(Updates prices throughout, and analyst comments)

By Johann M Cherian and Utkarsh Hathi

March 13 (Reuters) - The benchmark S&P 500 fell in

choppy trading on Friday and was on track to end the week lower,

along with the Nasdaq and the Dow, as investors weighed a mixed

run of economic data against a widening Middle East conflict.

The financials-heavy Dow was hit the hardest this week,

putting it on track for its biggest monthly losses since

December 2024.

A Commerce Department report showed economic growth slowed

more sharply in the fourth quarter, following downward revisions

to consumer spending and business investment, while a separate

report indicated that consumer spending increased slightly more

than expected in January.

Traders now see one 25 basis point interest rate cut by the

Federal Reserve by June 2027, compared with expectations of two

cuts earlier this month, according to LSEG-compiled data.

Barclays now expects two 25-basis-point rate cuts, with one in

September this year and the next in March 2027.

"This adds to the stagflation narrative, which is one of the

big market fears. If we're going to continue to see pressures

from higher oil prices while at the same time the economy is

slowing, that's not exactly a good combination," Steve Sosnick,

chief market analyst, Interactive Brokers

The Fed will potentially leave interest rates unchanged when

it meets next week. Spiking energy costs could complicate the

central bank's policy plans as other reports point to price

pressures and a softening job market.

Meanwhile, the University of Michigan's survey showed

consumer sentiment ebbed in early March on worries about higher

energy costs.

Crude prices hovered near $100 a barrel as hostilities in

the Middle East showed few signs of easing despite the Trump

administration's assurances of a swift resolution.

Efforts such as the International Energy Agency's record

emergency oil releases, and the U.S. 30-day license for

countries to buy Russian oil and petroleum products stranded at

sea have so far failed to bring down the surge in costs.

At 11:30 a.m. ET, the Dow Jones Industrial Average

rose 7.82 points, or 0.02%, to 46,685.67, the S&P 500

lost 16.01 points, or 0.24%, to 6,656.61 and the Nasdaq

Composite lost 104.09 points, or 0.47%, to 22,206.61.

Wall Street's fear gauge, the CBOE volatility index,

wavered and was last down 0.13 points at 27.16, while the

rate-sensitive Russell 2000 index fell 0.3%.

Six of the 11 S&P 500 sectors edged higher, with utilities

leading with a 1% rise, while heavy-weight tech stocks

fell 1.1%.

Credit quality worries deepened this week after Morgan

Stanley ( MS ) halted redemptions at one of its private credit

funds, following similar moves by BlackRock ( BLK ) and Blue Owl

in recent weeks.

JPMorgan Chase ( JPM ) also restricted lending to private

credit players, while Blackstone faced a surge in

redemptions.

Blue Owl rose 2.7%, and BlackRock ( BLK ) edged up 1.4% each,

rebounding from sharp losses in the previous session.

The broader S&P 500 financial sector fell 2.7% for

the week.

Travel stocks, hit the hardest by the war, and higher energy

costs, were mixed

Alaska Airlines and American Airlines ( AAL )

slipped 1.2%, while Carnival rose 1.3%.

Design software maker Adobe fell 6.6% as longtime

CEO Shantanu Narayen will leave his role once a successor is

appointed, renewing worries around its strategy as it grapples

with AI disruption.

Crypto-firm Strategy climbed 4.9% as bitcoin

prices rose more than 4%.

Megacap Meta slipped 3% as a report said it

postponed the release of its artificial intelligence model

"Avocado" to at least May, from this month.

Declining issues outnumbered advancers by a 1.17-to-1 ratio

on the NYSE and by a 1.24-to-1 ratio on the Nasdaq.

The S&P 500 posted 11 new 52-week highs and 7 new lows while

the Nasdaq Composite recorded 29 new highs and 123 new lows.

(Reporting by Johann M Cherian, Utkarsh Hathi in Bengaluru,

Stephen Culp in New York; Editing by Maju Samuel and Devika

Syamnath)