UPDATE 1-Wal-Mart index to rate products' environmental impact

* Index to be used to determine which products to stock

* Data could be used to one day give items "green" label

* Wal-Mart shares up 0.5 pct (Adds byline, Wal-Mart statement, details on environmental push)

By Nicole Maestri

SAN FRANCISCO, July 15 (Reuters) - Wal-Mart Stores Inc (WMT.N), the world's biggest retailer, will announce on Thursday the development of an index that will be used to measure the social and environmental impact of the products it sells in its discount stores.

The information could be used to one day provide consumers a label assessing how "green" or "sustainable" a product is.

"In 2005, Wal-Mart set an aspirational goal to sell products that sustain our resources and environment," states Matt Kistler, Wal-Mart's senior vice president of sustainability, on a website discussing the index.

"While important strides have been made in this area, we believe that to drive Wal-Mart's supply chain towards sustainable business practices we need a way to measure each of our current and potential products against this goal."

Wal-Mart has reached out to professors and environmental groups for help in developing the index. The retailer said it will be used to evaluate its 60,000 suppliers and determine which merchandise winds up on its store shelves.