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* Microsoft gains on $40 bln share buyback plan
* Healthcare stocks among top boosts to S&P 500
* U.S.-China low-level trade talks resume on Thursday
* Indexes up: Dow 0.20%, S&P 0.28%, Nasdaq 0.31%
(Updates to midday)
By Ambar Warrick and Medha Singh
Sept 19 (Reuters) - Gains in Microsoft and healthcare shares
boosted Wall Street's main indexes on Thursday, a day after the
Federal Reserve cut interest rates as expected and left the door
open for further monetary easing.
Shares of the software giant MSFT.O rose 1.5% and drove
the broader technology sector .SPLRCT up 0.37% after the
company unveiled a $40 billion stock buyback plan. The S&P 500 was about 12 points shy of its record high of
3,027.98, as markets also turned optimistic on talks between
U.S. and Chinese deputy trade negotiators aimed at laying the
groundwork for high-level negotiations in early October.
A recent easing in trade tensions has helped the three main
indexes recover all their losses from August.
On Wednesday, the Fed announced a quarter percentage point
cut in interest rates for the second time this year and said
future reductions would be "largely data-dependent".
Traders see a nearly 50% chance for another 25 basis point
rate cut in October, according to CME Group's FedWatch tool.
"The market just continues to believe the Fed is going to be
accommodative," said Robert Pavlik, chief investment strategist
and senior portfolio manager at SlateStone Wealth LLC in New
York.
The Fed injected another $75 billion into the U.S. banking
system on Wednesday, restoring a measure of order after the
central bank's benchmark interest rate rose above its targeted
range for the first time since the financial crisis.
The healthcare index .SPXHC , the worst performing S&P
sector this year, gained about 0.77% as U.S. House Speaker Nancy
Pelosi released a proposal on drug pricing policy.
The plan is a "big negative" for drugmakers and the stock
reaction has already been priced in to some degree, said Thomas
Martin, senior portfolio manager at GlobAlt Investments.
At 12:59 a.m. ET, the Dow Jones Industrial Average .DJI
was up 55.42 points, or 0.20%, at 27,202.50 and the S&P 500
.SPX was up 8.49 points, or 0.28%, at 3,015.22. The Nasdaq
Composite .IXIC was up 25.24 points, or 0.31%, at 8,202.63.
Shares of retailer Target Corp TGT.N rose nearly 1% after
it announced a $5 billion share buyback plan. Advancing issues outnumbered decliners by a 2.29-to-1 ratio
on the NYSE and a 1.76-to-1 ratio on the Nasdaq.
The S&P index recorded 22 new 52-week highs and one new low,
while the Nasdaq recorded 59 new highs and 28 new lows.