US STOCKS-Nasdaq ends higher while S&P 500 posts biggest August gain since 1986

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* Tesla soars, Apple gains as stock splits take effect
* Aimmune Therapeutics jumps on Nestle's $2 bln buyout offer
* U.S. suitors for TikTok assets slip as deal may need China
nod
* Dow off 0.78%, S&P down 0.22%, Nasdaq gains 0.68%

(Adds analyst comments, market details)
By Sinéad Carew
NEW YORK, Aug 31 (Reuters) - While the S&P boasted its
steepest August percentage gain in more than three decades it
ended Monday slightly lower and the Dow also lost ground as
investors took a pause although the Nasdaq closed higher thanks
to high-flying stocks including Apple Inc AAPL.O .
The Federal Reserve's commitment to tolerate inflation and
keep interest rates low, positive developments in vaccines and
treatments for COVID-19 and a rally in tech-focused stocks have
helped the S&P 500 and Nasdaq hit record highs in August.
But while states such as New Jersey continued to ease
restrictions on Monday, investors noted that across the United
States, total coronavirus cases topped 6 million on Sunday as
many states in the Midwest reported increasing infections,
according to a Reuters tally. "It's a momentum trade. People are flooding to the
technology companies they think will do well regardless of the
pandemic," said Chris Zaccarelli, chief investment officer,
Independent Advisor Alliance.
"The U.S. just passed 6 million cases, a further reminder
that the pandemic is here to stay until we do something about
it. Clearly it has an impact on all businesses but some are more
pandemic resistant," he said.
The Dow Jones Industrial Average .DJI fell 223.82 points,
or 0.78%, to close at 28,430.05, the S&P 500 .SPX lost 7.7
points, or 0.22%, to 3,500.31 and the Nasdaq Composite .IXIC
added 79.82 points, or 0.68%, to 11,775.46.
Technology .SPLRCT , then healthcare .SPXHC and utilities
stocks .SPXRCU were the biggest percentage gainers among the
11 major S&P sectors while energy .SPNY was the biggest
percentage decliner.
With the S&P reaching 3.8% above its pre-crisis record
during the session, Mona Mahajan, senior U.S. investment
strategist at Allianz Global Investors in New York, said
investors were showing some caution by favoring technology as
they looked warily at U.S. and overseas COVID-19 numbers.
"After such a strong summer run we're reverting back to the
old pandemic playbook so we see tech outperforming," she said.
"Really that's a defensive move as people think about
stay-at-home more as we're heading toward that fall season."
The Nasdaq, meanwhile, ended the day almost 20% above its
pre-crisis record closing high. Its top two boosts for Monday
were from Apple Inc AAPL.O and Tesla Inc TSLA.O after their
stock splits. While the splits did not provide a fundamental reason to buy
the stocks, Mahajan noted that the lower prices may be making
the momentum stocks more attractive to some retail investors.
For the month the S&P showed a gain of 7.01%, its biggest
advance for August since 1986 when it rose 7.1% that month.
The three main indexes showed their fifth straight monthly
rise following March lows, even as economic data pointed to an
uneven recovery from the steep downturn.
For the S&P, this was its longest winning steak on a monthly
basis since a six-month run from April to September 2018.
And the benchmark's 35.6% gain since April marked the
strongest five-month run for the S&P since 1938, according to
data from Bespoke Investment Group.
Apple ended the day 3.4% higher at $129.04 while Tesla
closed up 12.6% at $498.32.
Aimmune Therapeutics Inc 's AIMT.O shares soared 171.6%
after Swiss food group Nestle SA NESN.S offered to pay $2
billion for full ownership of the peanut allergy treatment
maker. Shares of Microsoft Corp MSFT.O , Walmart Inc WMT.N and
Oracle Corp ORCL.N - all suitors for TikTok's U.S. assets -
fell as China's new rules around tech exports meant a deal with
TikTok owner ByteDance could need Beijing's approval.
Declining issues outnumbered advancing ones on the NYSE by a
2.02-to-1 ratio; on Nasdaq, a 1.64-to-1 ratio favored decliners.
The S&P 500 posted 32 new 52-week highs and no new lows; the
Nasdaq Composite recorded 86 new highs and 24 new lows.
On U.S. exchanges 9.4 billion shares changed hands on Monday
compared with the average of 9.18 billion for the last 20
sessions.