US STOCKS-Microsoft drives S&P 500 near record high

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* Microsoft gains on $40 bln share buyback plan
* Oil stocks track recovery in crude prices
* U.S.-China low-level trade talks resume on Thursday
* Indexes up: Dow 0.19%, S&P 0.23%, Nasdaq 0.40%

(Updates to open)
By Ambar Warrick and Medha Singh
Sept 19 (Reuters) - Gains in Microsoft shares pushed the
benchmark S&P 500 within striking distance of its record high, a
day after the Federal Reserve cut interest rates as expected but
played down hopes of further monetary easing.
The software giant's plans to buy back $40 billion in shares
also boosted the Dow and the Nasdaq, while driving a 0.7% gain
in the wider technology sector .SPLRCT . The three main Wall Street indexes have recovered all their
losses from August, when renewed U.S.-China trade fears and the
prospect of a looming recession had led U.S. stock markets to
record their second monthly decline of 2019.
The S&P 500 .SPX is now just 10 points shy of an all-time
high of 3,027.98 hit in July.
Energy stocks .SPNY rose 0.2% on the back of higher oil
prices, which were supported by supply risks as the market
assesses the fallout from last weekend's drone attacks on Saudi
oil infrastructure. O/R
On Wednesday, the Fed announced a quarter percentage point
cut in interest rates, but Chair Jerome Powell said future
reductions would be "largely data-dependent". New projections showed policymakers at the median expected
rates to stay within the new range through 2020. However,
traders still see a 42.8% chance of another quarter percentage
point cut in October, according to CME Group's FedWatch tool.
"I think the Fed essentially left the door open to do
whatever is necessary," said Randy Frederick, vice president of
trading and derivatives for Charles Schwab in Austin.
"It all depends on what happens with economic data and the
(U.S.-China) trade discussions over the next six weeks or so,"
he said.
Fresh economic data showed U.S. current account deficit
narrowed sharply in the second quarter, while a reading on the
Philadelphia Fed business activity index clocked in at 12 for
September, slightly above expectations of 11. U.S. and Chinese deputy trade officials are set to resume
face-to-face talks on Thursday for the first time in nearly two
months, aiming to lay the groundwork for high-level negotiations
planned in early October. At 9:54 a.m. ET, the Dow Jones Industrial Average .DJI was
up 51.07 points, or 0.19%, at 27,198.15 and the Nasdaq Composite
.IXIC was up 32.42 points, or 0.40%, at 8,209.81.
Shares of retailer Target Corp TGT.N edged 0.4% higher
after it announced a $5 billion share buyback plan and a
quarterly dividend. Content delivery network provider Akamai Technologies Inc
AKAM.O was down 1.5% after KeyBanc analysts downgraded the
stock to "sector weight" from "over weight". Darden Restaurants Inc DRI.N slipped 3.8% as the
restaurant chain operator's quarterly sales missed analysts
estimates. Advancing issues outnumbered decliners by a 1.95-to-1 ratio
on the NYSE and a 1.38-to-1 ratio on the Nasdaq.
The S&P index recorded 15 new 52-week highs and no new low,
while the Nasdaq recorded 23 new highs and 13 new lows.