(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window.)

*

US single-family housing starts tumble in July

*

S&P 500, Nasdaq set for best week since October

*

Indexes down: Dow 0.13%, S&P 500 0.23%, Nasdaq 0.30%

(Updated at 9:35 a.m. ET/1335 GMT)

By Medha Singh and Shashwat Chauhan

Aug 16 (Reuters) -

Wall Street's main indexes slipped on Friday following the

S&P 500 and the Nasdaq's six-day winning streaks after a spate

of encouraging economic data allayed recession worries, while

weak housing data dampened sentiment.

Equities came under pressure a bit after data showed

U.S. single-family homebuilding

fell sharply in July

, suggesting that the housing market remained depressed at

the start of the third quarter.

Nine of the 11 major S&P 500 sectors were trading lower,

with energy the worst hit, tracking lower crude oil

prices.

The benchmark index has recovered from a pullback

earlier this month caused by a dour U.S. jobs report and the yen

carry trade as better-than-expected data calmed nerves over a

sharp slowdown in the world's largest economy.

U.S. consumer and producer prices data this week indicated

inflation was moderating at a pace that would keep the U.S.

Federal Reserve on track to start its monetary easing cycle with

a 25-basis point rate cut next month.

"The signal from this week's batch of data is that the sky

is not falling out as some investors had started to fear," said

Mike Reynolds, vice president of investment strategy at

Glenmede.

"The totality of the data we've gotten so far leading into

(the next Fed meeting) makes a really strong case for rate

cuts."

Market participants will look to minutes from the Fed's last

policy meeting and Fed Chair Jerome Powell's outlook of the U.S.

economy at the Jackson Hole symposium, an annual gathering of

global central bankers, next week for more clues on the rate cut

trajectory.

The S&P 500 and the Nasdaq were headed for their best weeks

since October, while the Dow was on pace for its best weekly

showing since December.

Later in the day, University of Michigan will issue its

consumer sentiment survey for August around 10 a.m. ET (1400

GMT).

In an interview with National Public Radio, Chicago Fed

chief Autan Goolsbee said the U.S. economy is not showing signs

of overheating, so central bank officials should be wary of

keeping restrictive policy in place longer than necessary.

At 9:35 a.m. ET, the Dow Jones Industrial Average

fell 53.74 points, or 0.13%, to 40,509.32, the S&P 500

lost 12.63 points, or 0.23%, to 5,530.59 and the Nasdaq

Composite lost 52.02 points, or 0.30%, to 17,542.48.

Applied Materials ( AMAT ) dropped over 3% following a

strong jump ahead of its results. The chip-making equipment firm

forecast fourth-quarter revenue slightly above Wall Street

estimates.

U.S.-listed shares of Amcor slipped 4% after the

packaging company reported a more-than-expected decline in

fourth-quarter sales, hurt by weaker demand for its containers

and cartons.

Overall, U.S. stock trading volume has been below its 20-day

moving average in the past six sessions as many investors are

away for summer break.

Declining issues outnumbered advancers by a 1.25-to-1 ratio

on the NYSE and by a 1.23-to-1 ratio on the Nasdaq.

The S&P 500 posted two new 52-week highs and no new

lows, while the Nasdaq Composite recorded 14 new highs and 28

new lows.