* Indexes: Dow off 0.2 pct, S&P off 0.07, Nasdaq up 0.2 (Adds Nucor halt)

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks were littlechanged Tuesday after promising data from the retail sectorfed recent optimism that the economic recovery, while slow, isproceeding.

Retailers were a bright spot after data showed U.S. retailsales rose in August for their largest gain in five months.Best Buy Co Inc's higher-than-expected quarterly profitand raised outlook validated the government figures. The S&P Retail index rose1.2 percent.

The broad S&P 500 index stayed above its 200-day movingaverage of around 1,115 after closing beyond that level Monday for the first time since early August.

Wall Street analysts have eyed the 1,130 level as a keyresistance point for the benchmark index, which could mean astrong move higher if it can pierce that target.

"We went through the 200-day yesterday, stayed above ittoday. It's only natural that we consolidate here a little bit,but if we punch through here, we will see 1,200," said StephenMassocca, managing director at Wedbush Morgan in SanFrancisco.

Gains were capped as financial shares gave back recentgains leading up to the Basel III rules, announced over theweekend, which set new capital regulations for banks.

After hitting an eight-month low on August 30, the KBW Bankindex jumped nearly 12 percent leading into the Baselannouncement before falling 1.4 percent Tuesday.

JPMorgan Chase & Co Chief Executive Jamie Dimonsaid in an investor presentation the new capital rules areexpected to increase bank loan prices for customers and maydrive some to seek financing from non-bank financialinstitutions. Shares slipped 1 percent to $40.72.

Helping sentiment Wednesday was a further decline in theU.S. dollar, which may indicate investors are turning away fromsafe-haven assets.

The Dow Jones industrial average dropped 17.64points, or 0.17 percent, to 10,526.49. The Standard & Poor's500 Index shed 0.80 points, or 0.07 percent, to1,121.10. The Nasdaq Composite Index gained 4.06points, or 0.18 percent, to 2,289.77.

Nucor Corp became the latest stock to trip the newmarket-wide circuit breaker rules, which pause trading for fiveminutes if the stock moves more than 10 percent, after thestock traded at 1 cent on the CBOE Stock Exchange.

Chipmakers led the technology sector higher, with thesemiconductor index up 1.7 percent.

Volume was light with about 7.2 billion shares traded onthe New York Stock Exchange, the American Stock Exchange andNasdaq, well below last year's estimated daily average of 9.65billion.

Declining stocks outnumbered advancing ones on the NYSE by1.2 to 1, while on the Nasdaq, decliners beat advancers five tofour.

(Editing by Padraic Cassidy)