*

Indexes: Dow off 0.52%, S&P 500 slips 0.09%, Nasdaq up

0.25%

*

Keurig Dr Pepper ( KDP ) slides after deal to buy Dutch JDE Peet's

*

Furniture retailers drop as Trump threatens tariff inquiry

(Updates with late morning prices)

By Johann M Cherian and Sanchayaita Roy

Aug 25 (Reuters) - Wall Street's main indexes were mixed

on Monday as investors weighed U.S. Federal Reserve Chair Jerome

Powell's hints of a near-term interest-rate cut and looked ahead

to AI leader Nvidia's ( NVDA ) quarterly earnings later in the week.

Markets took a pause from a rally late last week, when

Powell hinted that an interest-rate cut could be considered at

the central bank's September meeting, citing recent labor market

weakness.

The Personal Consumption Expenditures Price index - the

Fed's preferred inflation gauge - is due to be released on

Friday, while official nonfarm payrolls data is expected next

week. The reports will be crucial, especially after Powell said

a dovish verdict was not a certainty.

"The focus right now is the labor market," said Brian

Klimke, investment director at Cetera Investment Management.

"We have the job market that's rolling over a little bit

and the economy is weakening, so the Fed needs to act sooner

than later and they're seeing it too."

Powell's comments nudged major brokerages to revise their

expectations, with Barclays, BNP Paribas and Deutsche Bank

currently seeing a 25-basis-point reduction in borrowing costs

next month.

Traders now see an 81.9% chance of a Fed rate cut in

September, according to data compiled by LSEG. Remarks from

policymakers John Williams and Lorie Logan later in the day will

be scrutinized to see if they share Powell's policy outlook.

At 11:46 a.m. ET, the Dow Jones Industrial Average

fell 238.55 points, or 0.52%, to 45,393.19, the S&P 500

lost 6.03 points, or 0.09%, to 6,460.88, and the Nasdaq

Composite gained 54.05 points, or 0.25%, to 21,550.58.

Friday's optimism helped the blue-chip Dow close at a record

high for the first time since December 2024, and the benchmark

S&P 500 logged its strongest daily gain since May.

On Monday, Jefferies became the latest brokerage to raise

its year-end target for the S&P 500, at a time when companies

have tempered tariff-related forecasts.

Seven of the 11 S&P 500 sub-sectors edged lower. Consumer

staples, healthcare and utilities -

often traded as bond proxies - fell about 1% each as yields on

Treasury bonds edged higher.

Traders are awaiting AI darling Nvidia's ( NVDA ) earnings

on Wednesday to see if its $4 trillion valuation is justified.

The potential impact on Nvidia's ( NVDA ) forecasts from its recent

revenue-sharing deal with the U.S. government will be closely

watched. The chip major's shares edged up 1.8%, boosting the

broader tech sector.

In deals-related moves, beverage company Keurig Dr Pepper ( KDP )

slid 7.7% after saying it would buy JDE Peet's

for $18.4 billion in cash.

Furniture retailers RH and Wayfair ( W ) declined

about 5% each after U.S. President Donald Trump said on Friday

his administration would investigate furniture import tariffs.

Intel ( INTC ) inched up 1.1% after Trump said the U.S.

government was taking a stake in the chipmaker. He also said he

would make other deals similar to the one with Intel ( INTC ).

Declining issues outnumbered advancers by a 1.78-to-1 ratio

on the NYSE and declining issues outnumbered advancers by a

1.54-to-1 ratio on the Nasdaq.

The S&P 500 posted 13 new 52-week highs and no new lows,

while the Nasdaq Composite recorded 103 new highs and 24 new

lows.