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Retail sales rise 0.4% in September

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TSMC gains after forecasting Q4 revenue jump

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Elevance Health ( ELV ) down after cutting annual profit forecast

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Indexes up: Dow 0.27%, S&P 500 0.38%, Nasdaq 0.65%

(Updated at 09:53 a.m. ET/1353 GMT)

By Lisa Pauline Mattackal and Purvi Agarwal

Oct 17 (Reuters) -

Wall Street gained on Thursday, with the S&P 500 and the Dow

touching intraday record highs, driven by TSMC's upbeat forecast

and a bigger-than-expected rise in monthly retail sales

indicating a strong U.S. consumer.

Profit at Taiwan Semiconductor Manufacturing Co ( TSM ),

the world's largest contract chipmaker, beat market estimates

and the company forecast a jump in fourth-quarter revenue,

driven by demand for artificial intelligence chips.

The chipmaker's U.S.-listed shares soared 11.7%,

while AI-trade favorite Nvidia ( NVDA ) gained 3.6%.

The optimism spread to other chip stocks, with Broadcom ( AVGO )

adding 4% and Intel ( INTC ) gaining 1.9%, sending the

broader Philadelphia SE Semiconductor index 2.7% higher.

These gains put Information Technology in the

lead among the 11 S&P 500 sectors, with a 1.3% rise, while

Financials extended its gains from the previous session.

Declines in healthcare stocks, however, limited gains on

the Dow. Elevance Health ( ELV ) plummeted 14.2% after the

health insurer

slashed

its full-year profit forecast, dragging peers UnitedHealth ( UNH )

, which slipped 1.7%, and Centene ( CNC ), which fell 9%,

down with it.

Meanwhile, U.S. retail sales increased 0.4% in September,

slightly than expected, supporting the view that the economy

maintained a strong pace of growth in the third quarter. Weekly

jobless claims fell unexpectedly last week.

"Retail sales being good continues to show how resilient

the U.S. consumer is, given how (this) has kind of sent us away

from a recession the last couple of years," said Keith Buchanan,

senior portfolio manager at GLOBALT Investments.

"The equity markets will always receive good news on the

consumer in a positive way, and I think that's the case for this

morning's action."

The data supported the picture of healthy growth in the

world's largest economy, while keeping bets on a 25-basis-point

rate cut at the Federal Reserve's next meeting largely intact at

89.4%, according to CME's FedWatch.

The Dow Jones Industrial Average rose 114.94

points, or 0.27%, to 43,192.64, the S&P 500 gained 22.15

points, or 0.38%, to 5,864.62, and the Nasdaq Composite

added 118.82 points, or 0.65%, to 18,485.90.

A broadly upbeat start to the third-quarter earnings

season, strong economic data and the U.S. Federal Reserve

kicking off its policy-easing cycle have pushed the Dow and the

S&P 500 to fresh record highs, with the benchmark index close to

the psychologically important 6,000 mark.

Still, analysts have flagged increasingly stretched

valuations, high earnings expectations and likely volatility

ahead of November's U.S. presidential election as risk factors.

Insurer Travelers Companies ( TRV ) rose 7% after its

third-quarter

profit

beat Wall Street expectations.

Streaming giant Netflix ( NFLX ) is scheduled to report

third-quarter earnings after the bell. Its shares fell 1.5%.

Federal Reserve Bank of Chicago President Austan Goolsbee is

slated to speak later in the day.

EV-maker Lucid tumbled 14% after it said it expects

to report a bigger-than-expected loss for the third quarter and

announced a public offering of more than 262 million shares.

Declining issues outnumbered advancers by a 1.09-to-1

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

The S&P 500 posted 57 new 52-week highs and two new

lows, while the Nasdaq Composite recorded 81 new highs and 21

new lows.