(Updates to afternoon trading, adds analyst comment)

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Salesforce ( CRM ) drops after downbeat revenue forecast

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American Eagle Outfitters ( AEO ) surges on strong sales forecast

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Indexes: Dow up 0.7%, S&P 500 up 0.6%, Nasdaq up 0.6%

By Caroline Valetkevitch

NEW YORK, Sept 4 (Reuters) - The three major U.S. stock

indexes were higher on Thursday as labor market data did not

change expectations for an interest rate cut by the Federal

Reserve this month.

Shares of chip company Broadcom ( AVGO ), considered a key

artificial intelligence player, were up 1.2% ahead of its

quarterly results due after the closing bell.

Also helping the market, Amazon.com ( AMZN ) was up more

than 3%, while Meta Platforms ( META ) was up more than 1%.

Data earlier showed that the number of Americans filing new

applications for unemployment benefits increased more than

expected last week, while hiring by private employers slowed in

August, further evidence that labor market conditions were

softening.

But investors are especially keen to see the U.S. monthly

jobs report due on Friday.

"The labor market data we're going to get - payrolls -

tomorrow I don't see really changing anything significantly

because (Fed Chair Jerome) Powell has effectively already told

us we're getting a cut unless it's really, really out of

bounds," said Mike Dickson, head of research and quantitative

strategies at Horizon Investments in Charlotte, North Carolina.

The Dow Jones Industrial Average rose 325.18 points,

or 0.72%, to 45,596.41, the S&P 500 gained 36.04 points,

or 0.56%, to 6,484.30 and the Nasdaq Composite gained

124.88 points, or 0.58%, to 21,622.61.

Investors are pricing in a 95% probability of a 25

basis-point cut, CME's FedWatch Tool showed. The move was

largely expected after July's bleak payrolls figures and

Powell's dovish comments.

Limiting some of the day's gains, Salesforce ( CRM ) shares fell

5.2% after the company forecast third-quarter revenue below Wall

Street estimates on Wednesday, signaling lagging monetization

for its AI agent platform.

September is historically a weak month for stocks, with the

S&P 500 losing 1.5% on average since 2000, according to LSEG

data.

Among other gainers, American Eagle Outfitters ( AEO ) shares

jumped after the apparel company forecast third-quarter

comparable sales above estimates on Wednesday.

Advancing issues outnumbered decliners by a 2.08-to-1 ratio

on the NYSE. There were 181 new highs and 53 new lows on the

NYSE.

On the Nasdaq, 2,340 stocks rose and 2,120 fell as advancing

issues outnumbered decliners by a 1.1-to-1 ratio.