(For a Reuters live blog on U.S., UK and European stock

markets, click LIVE/ or type LIVE/ in a news window.)

*

MicroStrategy ( MSTR ) rises on Nasdaq 100 inclusion

*

Honeywell ( HON ) explores separation of aerospace business

*

Indexes: Dow off 0.02%, S&P 500 up 0.22%, Nasdaq up 0.41%

(Updates after markets open)

By Lisa Pauline Mattackal and Purvi Agarwal

Dec 16 (Reuters) -

The S&P 500 and the Nasdaq climbed while the Dow was flat on

Monday, as investors looked ahead to an anticipated Federal

Reserve interest rate cut later in the week, as well as several

key data releases that will help set the tone for policy next

year.

The Fed's final rate decision of the year is due on

Wednesday, with traders pricing in an over 97% chance of a 25

basis point rate reduction, as per CME's FedWatch.

However, the primary focus will be on policymakers' outlook

for next year, with an updated "dot plot" of forecasts also to

be released, as bets moderate on the pace of rate cuts amid

strong economic growth and persistent inflation.

"The market's hungry for more cuts and the Fed's left with a

task of juggling - is this doable without creating inflationary

pressure?" said Andre Bakhos, managing member at Ingenium

Analytics.

"The odds favor the enthusiasm," Bakhos said.

S&P Global's December flash PMI showed manufacturing

activity stood at 48.3, compared with estimates of 49.8

according to economists polled by Reuters, while services

activity stood at 58.5, above estimates of 55.7.

On the data docket are industrial production figures, retail

sales, and personal consumption expenditure data scheduled

throughout the week.

At 9:46 a.m. ET, the Dow Jones Industrial Average

fell 8.81 points, or 0.02%, to 43,819.25, the S&P 500

gained 13.34 points, or 0.22%, to 6,064.47 and the Nasdaq

Composite gained 82.02 points, or 0.41%, to 20,009.17.

Most megacap and growth stocks traded higher, with

Google-parent Alphabet up 2.1% and Amazon.com ( AMZN )

rising 1%, boosting communication services and

consumer discretionary sectors 1% and 0.7%

respectively.

Yields on Treasuries inched lower across the board, with

the ones on the benchmark 10-year bond easing from

an over three-week high hit on Friday. It was last at 4.3770%.

Crypotocurrency stocks rose as bitcoin briefly jumped

above $106,000 after President-elect Donald Trump suggested he

plans to create a U.S. bitcoin strategic reserve similar to its

strategic oil reserve.

Coinbase Global ( COIN ) rose 3.7% and bitcoin miner MARA

Holdings ( MARA ) gained 4.9%.

The benchmark S&P 500 and the blue-chip Dow ended the

previous week lower, while the tech-heavy Nasdaq clocked its

fourth straight week of gains after breaching the 20,000 mark

for the first time.

Still, stocks have had a bumper run in 2024 as gains in

artificial intelligence-related companies, the start of the

Fed's rate cutting cycle and expected pro-business policies from

Trump's incoming administration have lifted equities.

Shares of MicroStrategy ( MSTR ) rose 2.6% as the software

company and bitcoin buyer was set to join the Nasdaq 100 index

. Super Micro Computer ( SMCI ), among those set to be

removed from the index, dropped 7.1%. The changes will take

effect on Dec. 23.

Honeywell International ( HON ) gained 1.8% after the

industrial conglomerate said it was exploring a separation of

its aerospace business.

Declining issues outnumbered advancers by a 1.04-to-1 ratio

on the NYSE and by a 1.03-to-1 ratio on the Nasdaq.

The S&P 500 posted nine new 52-week highs and 12 new

lows, while the Nasdaq Composite recorded 50 new highs and 88

new lows.