US STOCKS-S&P 500, Dow drift higher as investors eye stimulus

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* Evergy slumps on report of plans to remain independent
* Relief package talks moving in right direction - Senate
Democratic leader
* AIG, Spirit Aero, Ralph Lauren slide as results disappoint
* Indexes: Dow rises 0.37%, S&P up 0.10%, Nasdaq dips 0.06%

(Updates to early afternoon)
By Sagarika Jaisinghani and Medha Singh
Aug 4 (Reuters) - The S&P 500 and Dow crept higher on
Tuesday as investors held out for more U.S. government stimulus,
but strained Sino-U.S. relations over TikTok and disappointing
quarterly earnings from Ralph Lauren and AIG curbed gains.
Ralph Lauren Corp RL.N slumped 6.5% to its lowest since
mid-May after quarterly revenue plunged by nearly $1 billion due
to coronavirus-led store closures and a slowdown in global
demand for luxury goods. American International Group Inc AIG.N also led the
declines on the S&P 500 with a 8.2% drop as its quarterly
adjusted profit slumped. Reflecting the cautious mood, defensive stocks including
real estate .SPLRCR , utilities .SPLRCU and consumer staples
.SPLRCS led gains among the major S&P sectors. Energy .SPNY
shone among the growth-linked cyclical sectors.
All eyes are now on a fifth major coronavirus-aid bill, with
Senate Democratic Leader Chuck Schumer saying talks with the
White House were moving in the "right direction". "A good portion of the stimulus and any likely improvement
in fundamentals has been priced in and we are seeing that in
stretched valuations," said Talley Leger, senior investment
strategist at Invesco in New York City.
"U.S. equities in general are one of the most overvalued
markets in the developed world, centered on technology."
A stimulus-led rebound and a rally in tech-related stocks
including Apple Inc AAPL.O , Netflix Inc NFLX.O and
Amazon.com Inc AMZN.O has brought the S&P 500 to within 3% of
its all-time high.
Meanwhile, with Microsoft Corp MSFT.O looking to buy
short-video app TikTok's U.S. operations, Trump said on Monday
the U.S. government should get a "substantial portion" of any
deal price.
On Tuesday, state-backed newspaper China Daily said the
country will not accept the "theft" of the technology company.
Microsoft's shares fell 2.1%.
At 12:38 p.m. ET, the Dow Jones Industrial Average .DJI
was up 99.11 points, or 0.37%, at 26,763.51, the S&P 500 .SPX
was up 3.41 points, or 0.10%, at 3,298.02. The Nasdaq Composite
.IXIC was down 6.06 points, or 0.06%, at 10,896.74.
Evergy Inc EVRG.N slumped 11% after two sources said the
board of the Midwest utility planed to remain independent as
bids solicited from prospective merger partners did not offer
sufficient value. Take-Two Interactive Software Inc TTWO.O rose 4.9% as it
raised its annual adjusted sales forecast on demand for its
videogame franchises "Grand Theft Auto" and "NBA 2K".
Rival Activision Blizzard Inc ATVI.O gained 1.4% ahead of
its results due after the closing bell.
About 83% of the 352 companies in the S&P 500 that have
reported quarterly results so far have beaten estimates for
earnings, according to IBES Refinitiv data.
Walt Disney Co DIS.N , Fox Corp FOXA.O and Wynn Resorts
Ltd WYNN.O are also expected to report quarterly results later
in the day.
Advancing issues outnumbered decliners by a 1.61-to-1 ratio
on the NYSE and by a 1.10-to-1 ratio on the Nasdaq.
The S&P index recorded 22 new 52-week highs and no new low,
while the Nasdaq recorded 107 new highs and eight new lows.