Financials boost S&P 500, Dow; tech drags on Nasdaq

By Stephen Culp

NEW YORK (Reuters) - The S&P 500 and the Dow Jones industrial average rose on Wednesday, with the Dow hitting its highest level since late January as rising Treasury yields boosted the financial sector and trade jitters abated.

Technology stocks dropped 0.3 percent, led by a 1.5 percent decline in Microsoft . The company raised its quarterly dividend on Tuesday by about 10 percent, but Morgan Stanley said the hike was below the company's 12-month trailing operating income growth.

Amazon.com slid 1.2 percent as European Union regulators looked into whether the online retailer was using merchant data to stifle competition.

Among the other components of the FAANG group of momentum stocks, all but Google parent Alphabet Inc were down. Other FAANG companies include Facebook Inc , Apple Inc and Netflix .

In the latest volley of the trade dispute between the United States and China as Premier Li Keqiang dismissed talk that Beijing is deliberately weakening its currency to boost exports.

But trade anxieties appeared to ease as investors anticipated little impact from China's actions. "The direct impact of the latest round of tariffs on the economy is likely to be minimal," wrote Bank of America Merrill Lynch in a research report.

"The overall sizes of these tariff issues are relatively small compared to the tax cuts and other stimulus measures that have been adopted," Forester added.

Declining issues outnumbered advancing ones on the NYSE by a 1.12-to-1 ratio; on Nasdaq, a 1.07-to-1 ratio favoured decliners.

The S&P 500 posted 32 new 52-week highs and no new lows; the Nasdaq Composite recorded 46 new highs and 42 new lows.

(Reporting by Stephen Culp; Editing by Nick Zieminski)