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* Cisco gains on quarterly results beat

* Initial weekly jobless claims drop more than expected

* Indexes down: Dow 0.15%, S&P 0.09%, Nasdaq 0.36%

Aug 17 (Reuters) - Wall Street's main indexes fell in choppy trading on Thursday as losses in healthcare stocks eclipsed gains in Cisco, while upbeat economic data kept alive fears of interest rates remaining higher for longer.

Weighing heavily on the S&P 500, CVS Health tumbled 9.8% on news that Blue Shield of California plans to cut its reliance on the company as its pharmacy benefit manager (PBM) and work with others including Amazon.com.

Shares of major health insurers UnitedHealth and Cigna, which also have PBM units, fell 1.3% and 7.6% respectively, dragging the broader S&P 500 healthcare index down 0.3%.

Pressuring equities further, the yield on 10-year U.S Treasury notes hit its highest level since October as a raft of strong economic data this week has stoked concerns the Fed could keep interest rates at the current level for longer.

A report from the Labor Department showed a fall in jobless claims last week, signaling the labor market remained tight.

Minutes from the Fed's July meeting released on Wednesday showed most policymakers prioritizing the battle against inflation, adding to uncertainty about the central bank's interest rate path.

"I don't think the Fed is likely to cut as soon as the market has priced in and they're unlikely to cut as much next year," said Steve Chiavarone, head of multi asset solutions at Federated Hermes. A majority of traders expect the Federal Reserve to keep rates unchanged in September, though bets of a pause have slipped to 86.5% from about 89% a week earlier, according to CME Group's Fedwatch tool.

"There's reason to continue to have another interest rate increase from here and then holding that longer than the market expects to," said Thomas Martin, senior portfolio manager at Globalt Investments.

Keeping a lid on losses, Cisco Systems gained 4.0% after the networking equipment maker's fourth-quarter results beat estimates, and its CEO talked up artificial intelligence opportunities.

Megacap growth stocks were mixed, with Apple down 1.1%, Amazon.com flat and Alphabet up 1.8%.

While retail heavyweight Walmart raised its full-year forecasts after beating second-quarter sales estimates, its shares fell 1.7%.

At 12:04 p.m. ET, the Dow Jones Industrial Average was down 51.71 points, or 0.15%, at 34,714.03, the S&P 500 was down 3.93 points, or 0.09%, at 4,400.40, and the Nasdaq Composite was down 49.17 points, or 0.36%, at 13,425.46.

Shares of Ball Corp climbed 2.8% after Britain's BAE Systems agreed to buy the beer can supplier's aerospace assets for about $5.55 billion.

Declining issues outnumbered advancers by a 1.34-to-1 ratio on the NYSE and a 1.53-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week highs and 14 new lows, while the Nasdaq recorded 17 new highs and 190 new lows.

(Reporting by Amruta Khandekar and Shristi Achar A in Bengaluru Editing by Vinay Dwivedi)