July 9, 2020 / 5:19 PM / a month ago

US STOCKS-Dow, S&P 500 slip on fears over surging virus cases

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* Weekly jobless claims rise less than expected

* Walgreens drops after swinging to quarterly loss

* Cisco rises after Morgan Stanley upgrade

* Indexes: Dow down 1.16%, S&P off 0.65%, Nasdaq up 0.21% (Updates to early afternoon)

By Medha Singh and C Nivedita

July 9 (Reuters) - The S&P 500 and Dow dropped on Thursday as fears of another round of business shutdowns to contain a surge in coronavirus cases overshadowed data pointing to a declining trend in weekly jobless claims.

However, Amazon.com, Microsoft Corp and Apple Inc helped the tech-heavy Nasdaq reverse earlier losses to hit another record high.

The United States saw more than 60,000 new COVID-19 infections on Wednesday, setting a single-day global record while Florida and Texas reported a record one-day increase in deaths.

“We need consumers and businesses to be engaged in a recovery - shutdown or no shutdown - and the news of increased spread of the virus weighs on consumer psychology and sentiment,” said Willie Delwiche, investment strategist at Baird in Milwaukee.

“The market has rallied in anticipation of progress being made on the economy and today is a step back from that.”

A batch of upbeat economic data including the record pace of job additions in June has underscored that the stimulus-fueled domestic economy was on the path to recovery.

The benchmark S&P 500 has risen more than 40% from its March lows and is now about 7.8% below its February record high. The Nasdaq notched a record close in the prior session and the Dow is about 13.6% from its own February all-time peak.

U.S. stocks had opened higher after data showed the number of Americans filing for jobless benefits dropped to a near four-month low last week, but a record 32.9 million people were collecting unemployment checks in the third week of June.

At 01:10 p.m. ET the Dow Jones Industrial Average fell 1.16% to 25,764.46. The lost 0.65% to 3,149.26 and the Nasdaq rose 0.21% to 10,515 points.

Cyclical energy and financials lost the most ground among the 11 major S&P sectors.

In a bullish signal for near-term momentum, the benchmark S&P 500’s chart formed a “golden cross” pattern, in which its 50-day moving average vaulted above the 200-day moving average.

Walgreens Boots Alliance Inc tumbled 9% after it reported a quarterly loss compared with a profit a year earlier, hurt by non-cash impairment charges of $2 billion as COVID-19 disrupted business at its Boots UK division.

Cisco Systems Inc rose 2% as Morgan Stanley upgraded its rating on the network gear maker’s stock to “overweight”.

Declining issues outnumbered advancers for a 3.69-to-1 ratio on the NYSE and for a 2.78-to-1 ratio on the Nasdaq.

The S&P index recorded 31 new 52-week highs and one new low, while the Nasdaq recorded 107 new highs and 28 new lows. (Reporting by Medha Singh and C Nivedita in Bengaluru; Editing by Shounak Dasgupta and Maju Samuel)

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