US STOCKS-Wall St cuts losses after upbeat manufacturing data

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* Sept. flash manufacturing PMI 51 vs. 50.3 for Aug.

* Apple gains on tariff exemptions

* Wall Street posted worst session in 2 weeks on Friday

* Indexes down: Dow 0.17%, S&P 0.09%, Nasdaq 0.12% (Updates to open)

Sept 23 (Reuters) - U.S. stocks pared early losses on Monday after a better-than-expected manufacturing survey reinforced confidence in the domestic economy.

IHS Markit’s Purchasing Manager’s Index (PMI) for U.S. manufacturing activity rose to a reading of 51 in September from 50.3 in August, topping expectations of economists polled by Reuters. Services PMI came in slightly weaker than expected at 50.9.

The report follows dour business surveys from across the euro zone, which suggested growth had ground to a halt in the bloc.

Other economic reports on investor radar in the final week of the third quarter include core personal consumption data - the Fed’s preferred inflation gauge - and final reading of second-quarter GDP data.

Investors have been cautious about progress in Sino-U.S. trade talks after a Chinese agriculture delegation canceled a visit to Montana that pulled the Wall Street’s main indexes to their worst session in about two weeks on Friday and ended a three-week run of gains.

Still, U.S. and Chinese officials described the deputy-level trade talks last week, meant to lay the groundwork for high-level negotiations in October, as being “constructive” and “productive”.

“While chances of a complete deal are pretty remote, people are pinning their hopes on any deal where they just stop the escalation (of the trade war),” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

Investors will also be watching for a speech by Federal Reserve Bank of New York President John Williams at the 2019 U.S. Treasury Market Conference.

At 10:01 a.m. ET, the Dow Jones Industrial Average was down 44.69 points, or 0.17%, at 26,890.38, the S&P 500 was down 2.66 points, or 0.09%, at 2,989.41. The Nasdaq Composite was down 9.67 points, or 0.12%, at 8,108.01.

The so called defensive sectors - consumer staples , utilities and real estate - posted were the biggest gainers among the four of the 11 major S&P sectors that were higher.

Apple Inc rose 0.3% after U.S. trade regulators approved 10 out of 15 requests for tariff exemptions by the iPhone maker.

Boeing dropped 0.9% after a Reuters report that European antitrust regulators were set to investigate the plane maker’s $4.75 billion bid for the commercial aircraft arm of Brazil-based Embraer SA.

Additionally, the chief of the U.S. Federal Aviation Administration is set to detail progress on the Boeing 737 MAX aircraft to international air regulators, who are divided about returning the grounded jet to flight after two fatal crashes.

Juniper Networks Inc rose 1% as Needham upgraded the network gear maker’s stock to “buy”.

Declining issues outnumbered advancers for a 1.06-to-1 ratio on the NYSE and for a 1.53-to-1 ratio on the Nasdaq.

The S&P index recorded 6 new 52-week highs and one new low, while the Nasdaq recorded 19 new highs and 23 new lows. (Reporting by Ambar Warrick and Medha Singh in Bengaluru; Editing by Anil D’Silva)