* Indexes down: Dow 0.54%, S&P 500 0.86%, Nasdaq 1.20%

* Jefferies dips after posting Q1 profit below estimates

* OECD warns Iran war erases global growth upgrade

* Weekly jobless claims in line with estimates

(Updates on market open)

By Purvi Agarwal and Twesha Dikshit

March 26 (Reuters) - Wall Street's main indexes dropped

on Thursday following gains in the previous session, as

investors remained cautious about developments in the Middle

East while weighing the prospects for de-escalation in the

conflict.

U.S. President ​Donald Trump said Iran was desperate to make

a deal to end the fighting and urged Tehran to "get serious"

about a deal. Iran's Tasnim News Agency said Tehran had

officially responded to the United States' 15-point proposal,

citing sources with knowledge. Iran had denied any negotiations

with the U.S. in public.

Contradictory signals from both sides left markets on edge,

as hopes for a breakthrough to restore shipping through the

crucial Strait of Hormuz remained uncertain.

"Hearing a lot of different things come out, you have the

market trying to figure out exactly what's going on. We're

watching oil prices ... We're still a little bit cautious there

because some of the downside scenarios aren't good for the

global economy," said Jack Herr, primary investment analyst at

GuideStone.

"But overall if we can get a quick resolution of this thing,

the backdrop for another good year in the market is there with

some of the fundamentals and growth numbers we're seeing."

At 9:40 a.m. ET, the Dow Jones Industrial Average

fell 250.43 points, or 0.54%, to 46,179.06, the S&P 500

lost 56.82 points, or 0.86%, to 6,535.08 and the Nasdaq

Composite lost 262.81 points, or 1.20%, to 21,667.02.

Technology stocks were the main laggards and the S&P 500

tech index fell 1.3%. Memory chipmakers continued to

selloff, with Micron Technology ( MU ), SanDisk ( SNDK ) and

Western Digital ( WDC ) down between 3.3% and 4.8%.

Meta Platforms ( META ) and Alphabet dropped 3.2%

and 2%, respectively, weighing on the communication services

index. The Philadelphia SE Semiconductor index

lost almost 2%.

The escalating conflict in the Middle East has knocked the

global economy off a stronger growth path, the OECD warned on

Thursday, with a closure of the Strait of Hormuz threatening to

push inflation sharply higher.

Central banks have been put in a tough spot with regard to

interest rates, as money market participants no longer price in

any easing from the U.S. Federal Reserve this year. Two rate

cuts had been expected before the Iran conflict erupted,

according to the CME Group's FedWatch Tool.

Data showed new applications for U.S. unemployment benefits

rose slightly last week, suggesting a stable labor market and

allowing the Fed to hold rates steady while monitoring the

impact of the Iran war.

Comments from Fed officials Lisa Cook, Stephen Miran,

Michael Barr and Philip Jefferson are on deck through the day.

Among individual movers, shares of Olaplex ( OLPX ) jumped

50% after Germany's Henkel agreed to buy the hair-care

brand in a $1.4 billion deal.

U.S.-listed shares of gold miners slipped as bullion prices

declined more than 1%. Sibanye Stillwater lost

2.2% and Harmony Gold shed 1.1%.

Declining issues outnumbered advancers by a 2.78-to-1 ratio

on the NYSE and by a 2.38-to-1 ratio on the Nasdaq.

The S&P 500 posted nine new 52-week highs and two new lows,

while the Nasdaq Composite recorded 14 new highs and 75 new

lows.