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Dow crosses 40,000 level for first time

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World stocks at record high after month-long surge

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Dollar up

(Updates to 2:30 p.m. ET)

By Caroline Valetkevitch

NEW YORK, May 16 (Reuters) - The Dow Jones industrial

average crossed the 40,000 level on Thursday for the first time

and a world stock index scored a third straight record intraday

high amid U.S. interest rate cut hopes and strong earnings

before stocks turned mostly flat in afternoon trading.

Data on Wednesday showed cooling consumer price inflation,

although that was offset on Thursday by news that U.S. jobless

claims fell in the latest week and by figures showing U.S.

import prices increased 0.9% last month.

That data boosted U.S. Treasury yields and the dollar.

The S&P 500 and Nasdaq also hit record highs in early New

York trading and were little changed by afternoon.

Shares of Walmart ( WMT ) jumped 7% after the retail giant

raised its fiscal 2025 sales and profit forecast.

The Dow Jones Industrial Average rose 13.70 points,

or 0.03%, to 39,921.54, after earlier breaching the 40,000

level. The S&P 500 lost 2.01 points, or 0.04%, to

5,306.24 and the Nasdaq Composite lost 17.50 points, or

0.10%, to 16,725.09.

"What (the Dow hitting 40,000) means is that regardless of

the concerns about inflation and consumer sentiment, the

companies in the Dow, which represent a cross section of our

economy, continue to march higher on better earnings and

stronger guidance," said Quincy Krosby, chief global strategist

at LPL Financial in Charlotte, North Carolina.

MSCI's gauge of stocks across the world rose

1.14 points, or 0.14%, to 794.91, after hitting a third straight

record intraday high. The STOXX 600 index fell 0.21%.

Overnight in Asia, Chinese and Hong Kong property shares had

also rallied after reports that Beijing was considering a plan

for local governments to buy up millions of unsold homes across

the country.

The dollar index, which measures the US currency

against a basket of currencies including the yen and the euro,

gained 0.26% at 104.47, with the euro down 0.14% at

$1.0867.

Against the Japanese yen, the dollar strengthened

0.26% at 155.27.

Data on Thursday showed the number of Americans filing new

claims for unemployment benefits fell 10,000 to a seasonally

adjusted 222,000 in the latest week, indicating a still-strong

labor market.

Benchmark 10-year yields were last up 2.1 basis

points to 4.377%, after earlier falling to 4.313%, the lowest

since April 5.

U.S. crude gained 60 cents to settle at $79.23 a

barrel and Brent rose 52 cents to settle at $83.27.

Spot gold fell 0.1% to $2,383.22 per ounce as of 1645

GMT, after hitting its highest since April 19 earlier in the

session. Bullion rose more than 1% on Wednesday.

(Additional reporting by Marc Jones in London; Editing by Chizu

Nomiyama, Susan Fenton and Jane Merriman)