(Updates prices to afternoon trading)

* Indexes up: Dow 0.27%, S&P 500 1.01%, Nasdaq 1.55%

* Intel ( INTC ) up after Trump says co to partner with Apple ( AAPL ) on chip

design

* Accenture ( ACN ) tumbles after trimming the top end of its FY

revenue forecast

* Data showed weekly jobless claims fell amid low layoffs

By Twesha Dikshit and Joel Jose

June 18 (Reuters) - U.S. stock indexes rebounded on Thursday

with semiconductor shares leading gains, as optimism about a

Middle East peace deal helped ease inflation fears, although

investors still priced in Federal Reserve interest rate

increases.

The Philadelphia semiconductor index sharply outperformed

the rest of the market as Intel's ( INTC ) shares jumped to a

record high. U.S. President Donald Trump said iPhone maker Apple ( AAPL )

had agreed to work with Intel ( INTC ) to design and manufacture

its chips in the U.S.

Oil prices slid to their lowest levels since early March after

the U.S. and Iran signed an interim agreement that extends the

April ceasefire by another 60 days to allow the two sides to

reach a final deal.

All three of Wall Street's major indexes had tumbled in the

previous session as investors priced in the likelihood of Fed

rate hikes, after the central bank's new Chair Kevin Warsh

underscored the need to curb inflation and other policymakers

signaled higher borrowing costs ahead.

"There are three factors causing the rally today. It's the

continued excitement around the semiconductor sector and the

continued decline of oil prices and the rethinking of

yesterday's Fed meeting," said Eric Johnston, chief equity and

macro strategist at Cantor in New York.

Investors were still assessing the impact of Warsh's indication

that the Fed would provide less guidance on future policy moves

along with his stated focus on price stability, according to

Johnston, who added that "the conclusion today is that the Fed

has more credibility around inflation."

At 2:17 p.m., the Dow Jones Industrial Average

rose 139.91 points, or 0.27%, to 51,632.46, the S&P 500

gained 75.04 points, or 1.01%, to 7,495.29 and the Nasdaq

Composite gained 403.52 points, or 1.55%, to 26,425.17.

But while stocks were rallying, Brian Jacobsen, chief

economic strategist at Annex Wealth Management, saw some

investor doubts about whether the interim U.S.-Iran agreement

would result in a lasting deal.

That caution was partly reflected in trader bets on a 50% chance

of a 25-basis-point rate hike as soon as September and a 17%

probability for a 50-basis-point hike, according to CME Group's

FedWatch tool.

Six out of 11 major S&P 500 sectors moved higher. Technology

was leading gains with a 2.5% advance, followed by

consumer discretionary, up 1.6%. Consumer stocks were

boosted by the travel segment as lower oil prices supported

rallies in cruise-line companies and airline stocks.

The small-cap Russell 2000 index rose 1.6%.

On the data front, Labor Department data showed the number

of Americans filing claims for unemployment benefits fell last

week as layoffs remained low.

In individual stocks, shares of Accenture ( ACN ) tumbled more

than 18% after the company trimmed the top end of its annual

revenue forecast. Peers Cognizant Technology Solutions ( CTSH ),

Gartner ( IT ) and IBM ( IBM ) fell in sympathy with declines

between nearly 4% and more than 8%. The S&P 500 software and

services sector was last down 0.6% after earlier

falling to a more than two-month low.

Among other movers, Kroger ( KR ) dropped 8% after the grocer

reported a lower-than-expected profit for the first quarter and

kept its annual forecasts unchanged.

Shares in Elon Musk's SpaceX were down 6% around $180,

in their second straight day of losses but were still trading

above the $135 pricing for their market debut last Friday.

Thursday also marks the once-in-a-quarter simultaneous

expiry of derivatives contracts tied to stocks, index options

and futures, also known as "triple witching", which can boost

trading volume and aggravate volatility.

Advancing issues outnumbered decliners by a 1.71-to-1 ratio on

the NYSE, where there were 231 new highs and 163 new lows. On

the Nasdaq, 2,879 stocks rose and 1,843 fell as advancing issues

outnumbered decliners by a 1.56-to-1 ratio. The S&P 500

posted 29 new 52-week highs and 26 new lows while the Nasdaq

Composite recorded 102 new highs and 123 new lows.