* Indexes down: Dow 0.54%, S&P 0.36%, Nasdaq 0.50%

* Asset managers dip as Partners Group caps withdrawals

on PE fund

* Broadcom ( AVGO ) dips ahead of quarterly results after market

close

(Updates to market open prices)

By Medha Singh and Twesha Dikshit

June 3 (Reuters) - Wall Street's main indexes retreated

on Wednesday after a run of record highs, while a fresh Middle

East flare-up pushed oil prices higher and cast doubts over a

quick end to the war.

Stocks and sectors that led gains in recent days logged the

steepest declines. Software stocks shed 3.1%

following a sharp rebound, while Datadog ( DDOG ), Palo Alto

and IBM ( IBM ) fell between 6.7% and 7.7%.

Four of the 11 S&P 500 sectors were in the red, with the

tech index leading the declines.

Brent crude futures rose over 2% after an Iranian missile

attack damaged Kuwait's airport and the U.S. military carried

out strikes near the Strait of Hormuz, raising the risk of

further supply disruption that could stoke broader inflation.

"We won't have any drawdown (in U.S. stocks) without some

solid evidence of the Middle East situation's influence on

unusually high inflation prints... prints with high positive

surprise as we did in 2022," said Alexander Lis, chief

investment officer at Social Discovery Ventures.

Latest data showed that the U.S. services sector activity

picked up in May as businesses preemptively placed orders and

rebuilt inventories in anticipation of shortages and higher

prices because of the war with Iran.

It came ahead of Friday's closely watched labor market

report, which could shape expectations for monetary policy.

Money markets expect the Federal Reserve to keep interest

rates on hold for the remainder of the year, with growing odds

of a 25 bps rate hike.

At 10:03 a.m. ET, the Dow Jones Industrial Average

fell 278.51 points, or 0.54%, to 51,029.28, the S&P 500

lost 27.18 points, or 0.36%, to 7,582.48 and the Nasdaq

Composite lost 134.41 points, or 0.50%, to 26,959.49.

The smallcap Russell 2000 dropped 1.3%.

The S&P 500 closed above 7,600 for the first time on

Tuesday, as all three major indexes ended at records, driven by

a run of corporate updates reinforcing expectations of sustained

AI spending.

The Philadelphia chip index slid 0.7%. Broadcom ( AVGO )

shares dipped 1.2% ahead of the company's quarterly

report due after market close. The results would be the next key

test of AI-driven momentum. The stock has already risen 14% in

the past four sessions.

Marvell Technology ( MRVL ) bucked the trend and extended

gains with a 2% rise, hitting $250 billion in market value, a

day after Nvidia CEO Jensen Huang called the chipmaker the next

"trillion-dollar company."

Fed Chair Kevin Warsh pledged to follow "the best of the

Fed's traditions" in a note to staff at the start of his

four-year term.

In other corporate news, asset managers dropped after

Switzerland's Partners Group capped withdrawals from an

$8.6 billion private equity fund. KKR, Blackstone

, Blue Owl and Ares Management ( ARES ) fell

between 5.3% and 6.3%.

GameStop ( GME ) advanced 8.5% after posting a rise in

quarterly revenue and unveiling a $2 billion share buyback

program.

Meanwhile, Elon Musk's SpaceX plans to price its IPO at $135

a share, ahead of a roadshow, to raise a record $75 billion, a

source familiar with the matter told Reuters on Tuesday.

Declining issues outnumbered advancers by a 2.61-to-1 ratio

on the NYSE and by a 2.78-to-1 ratio on the Nasdaq.

The S&P 500 posted 19 new 52-week highs and 10 new

lows, while the Nasdaq Composite recorded 48 new

highs and 74 new lows.

(Reporting by Medha Singh and Twesha Dikshit in Bengaluru;

Editing by Mrigank Dhaniwala and Shinjini Ganguli)