US STOCKS-Techs rise on Cisco, moderating oil price

* Tech shares rally, boosted by Cisco comments on outlook

* Oil continues to slide, falls to $118/bbl

* Freddie Mac posts loss, to slash dividend

* Dow, S&P flat, Nasdaq up 0.7 pct (Updates to midday, recasts, changes byline)

By Steven C. Johnson

NEW YORK, Aug 6 (Reuters) - U.S. technology shares rose on Wednesday, boosting optimism about future corporate spending and profits, but the Dow and S&P were little changed due to concerns about fallout from the mortgage crisis.

Tech stocks rose after Cisco Systems Inc (CSCO.O), the largest U.S. maker of equipment that directs Web traffic, said it expects the weak economic environment to be relatively short-lived. Shares jumped 6 percent, making the stock the biggest percentage gainer on the Nasdaq 100 index and a leader on the S&P 500.

The technology sector also got a lift from a report Microsoft Corp (MSFT.O) may buy back as much as $20 billion of its stock to boost its share price. Shares rose nearly 2 percent after the report by Bloomberg News, citing a UBS analyst report. Microsoft could not be reached for comment.

Further declines in oil's price helped the broad market recover from earlier losses sparked by a news of a fourth straight quarterly loss from home finance company Freddie Mac (FRE.N), which was down 12 percent.