*

Euro eases a fraction after ECB meeting

*

Dollar gains after U.S. manufacturing data

*

Stocks sag after early rise thanks to TSMC

(Updates at 11 am ET)

By Isla Binnie

NEW YORK, July 18 (Reuters) - Wall Street was slightly

lower on Thursday in choppy trading after mostly giving up early

gains driven by strong demand from the world's largest

chipmaker, while European shares rose after the ECB left rates

unchanged.

Japan's yen wilted after scaling a six-week high, while

the euro eased a fraction after ECB President Christine Lagarde

held off any rate change but said an interest rate decision at

the ECB's next meeting in September was "wide open".

The Dow Jones Industrial Average was down 84.79

points, or 0.21%, at 41,112.74, the S&P 500 lost 22.22

points, or 0.39%, to 5,566.32.

The Nasdaq Composite fell 139.86 points, or 0.78%,

to 17,856.63, giving back early gains after initially recovering

from Wednesday's session, which was its worst since December

2022 The STOXX 600 index rose 0.01%.

U.S.-listed shares of TSMC dipped after

previously jumping 2.1% thanks to a raise in the Taiwan

chipmaker's full-year revenue forecast on surging demand for AI

chips. A semiconductor index was up.

MSCI's gauge of stocks across the globe

fell 3.77 points, or 0.46%, to 819.82.

Tech company earnings will be next on investors' radars as

the U.S. second-quarter earnings season picks up steam.

"Risks in the technology sector got pointed out

yesterday, with continuing trade issues between the U.S. and

China," said Paul Nolte, senior wealth adviser and market

strategist for Murphy & Sylvest.

DATA BOOSTS DOLLAR

In the foreign exchange market, the dollar index advanced

after strong U.S. manufacturing data and jobless data that did

little to suggest a significant slowing in the labor market. The

euro was weaker after the ECB policy statement.

The dollar index gained 0.29% to 103.97, after

hovering close to its weakest level in four months. The euro

was down 0.26% at $1.0909. It had touched a four-month

low of 103.64 on Wednesday.

Initial claims for U.S. state unemployment benefits

increased 20,000 to a seasonally adjusted 243,000 for the week

ended July 13, the Labor Department said on Thursday. Economists

polled by Reuters had forecast 230,000 claims for the latest

week, although the data was not considered to be a notable shift

in the labor market due to seasonal factors.

Interest rate sensitive two-year yields were last

up 1.5 basis points on the day at 4.444%, but were down from

around 4.455% before the weaker-than expected labor data.

The yield on benchmark U.S. 10-year notes rose

2.1 basis points to 4.167%, from 4.146% late on Wednesday.

The yen came off its highs after daily data showed little

fresh evidence of intervention from authorities. It weakened

0.28% against the dollar at 156.59 per dollar.

The yen has dropped 9.5% against the dollar this year as the

wide interest rate difference between the U.S. and Japan weigh,

creating a lucrative trading opportunity, in which traders

borrow the yen at low rates to invest in dollar-priced assets

for a higher return, known as carry trade.

In commodities, gold was higher, adding 0.25% to

$2,464.50 an ounce, although below the record high of $2,483.60

it touched on Wednesday.

U.S. crude was down 0.53% at $82.41 a barrel and

Brent fell to $84.59 per barrel, down 0.58% on the day.

(Additional reporting by Karen Valetkevitch; Editing by Arun

Koyyur and Susan Fenton)