*

Indexes off: Dow 0.42%, S&P 500 0.52%, Nasdaq 0.81%

*

Dollar General ( DG ) forecasts downbeat FY comparable sales

growth

*

Intel ( INTC ) gains after naming chip industry veteran Lip-Bu Tan

CEO

*

Adobe falls after dull quarterly revenue forecast

*

US producer prices unchanged in February

(Updates with morning prices)

By Johann M Cherian and Pranav Kashyap

March 13 (Reuters) -

The main U.S. stock indexes slipped on Thursday as President

Donald Trump's escalated tariff rhetoric against the European

Union impacted investor sentiment, although cooling inflation

provided some relief.

In his latest trade salvo, Trump announced a plan to

levy a

200% duty

on European beverage imports unless the EU removes

surcharges on U.S. whiskey. He had previously threatened to

penalize the bloc if it imposed retaliatory tariffs on American

goods next month.

U.S. beverage makers rose, with Brown-Forman ( BF/A ) adding

1.6%, Molson Coors ( TAP/A ) edging up 0.3% and Constellation

Brands ( STZ ) adding 0.9%.

"The guidance out of the White House is so erratic that

investors cannot absorb every news flash into their investment

strategies," said Peter Andersen, founder of Andersen Capital

Management.

Markets were roiled earlier this week by Trump's

unpredictable trade restrictions, stoking concerns that an

escalating trade conflict on multiple fronts could spur domestic

inflation and potentially hinder growth.

The trade restrictions have unsettled investors, leading

brokerages to lower their projections for U.S. equities, while

several companies have issued cautious forecasts.

Dollar General ( DG ) forecast annual comparable sales

growth

largely below estimates

. However, its shares gained 4.5% on its upbeat quarterly

results.

Consumer discretionary led declines amongst

S&P 500 sub-sectors, falling 1.8%. Tesla and Amazon.com ( AMZN )

lost 3.6% and 1.8%, respectively.

Offering investors some hope on the economy's

resilience, data showed producer prices were

unexpectedly unchanged

in February, while a separate weekly report pointed to

fewer-than-expected

jobless claims

.

However, worries that the trend could be short-lived

prevailed, with traders expecting the U.S. Federal Reserve to

lower borrowing costs by nearly 75 basis points in the second

half of the year, according to data compiled by LSEG.

"Many people will discount these numbers. However, they

do speak to the underlying trend... (before tariffs took)

effect, and at least we are starting from a better place," said

Chris Zaccarelli, chief investment officer for Northlight Asset

Management.

At 09:51 a.m. ET the Dow Jones Industrial Average

fell 174.90 points, or 0.42%, to 41,176.03, the S&P 500

lost 28.94 points, or 0.52%, to 5,570.36, and the Nasdaq

Composite was down 142.66 points, or 0.81%, to

17,505.79.

The benchmark S&P 500 teetered on the brink of its

longest weekly losing streak in seven months.

Markets were also on edge with a deadline to pass a

funding bill

in the U.S. Senate fast approaching. If it goes through,

the bill will keep the U.S. government operational through

September 30.

Among other stocks, Intel ( INTC ) jumped 15.7% after the

beleaguered chipmaker appointed industry veteran Lip-Bu Tan its

chief executive officer.

Adobe dropped 10.9% after the Photoshop-maker

forecast quarterly revenue in line with estimates.

Shares of truck- and parts-makers such as Paccar ( PCAR )

and Cummins fell 2.8% and 1.5%, respectively, after the

Environmental Protection Agency launched efforts to undo the

previous administration's vehicle-emissions rules.

Declining issues outnumbered advancers by a 1.11-to-1 ratio

on the NYSE, and by a 1.29-to-1 ratio on the Nasdaq.

The S&P 500 posted no new 52-week highs and 11 new lows,

while the Nasdaq Composite recorded nine new highs and 84 new

lows.