* FedEx falls on dour annual revenue forecast

* General Mills slips after annual sales forecast cut

* Alphabet up as report says Google to restructure ad sales unit

* Indexes up: Dow 0.06%, S&P 0.01%, Nasdaq 0.22%

NEW YORK, Dec 20 (Reuters) - U.S. stocks were muted on Wednesday as a gloomy FedEx outlook sapped Wall Street's upward momentum, which had been driven by falling interest rates and the Federal Reserve's dovish turn.

The S&P 500 and the Dow were essentially unchanged, with the Nasdaq out front as Alphabet jumped after it announced plans to restructure Google's ad sales unit.

Having notched seven consecutive weekly gains, the S&P 500 is less than 1% below its all-time closing high. Reaching a new closing high would confirm the benchmark index has been in a bull market since closing at the bear market floor in October 2022.

"(Investors are) getting news like FedEx earnings, which were not terrible, but indicative of a potential slowdown," said Thomas Martin, Senior Portfolio Manager at GLOBALT in Atlanta. "On the other hand, the consumer sentiment numbers were very positive."

"We've had this aggressive rally in December and investor sentiment is high, it went from bearish to bullish in almost record time," Martin added. "So the markets are asking 'now what?'"

At the conclusion of its policy meeting last Wednesday, the Federal Open Market Committee signaled that it had reached the end of its tightening cycle and opened the door to rate cuts in the coming year.

Chicago Fed President Austan Goolsbee late Tuesday reiterated that the rate at which inflation cools to the Fed's annual 2% target will drive policy on rate reduction.

At last glance, financial markets were pricing in a 69.6% likelihood of that first cut arriving as soon as March, according to CME's FedWatch tool.

On the economic front, bigger than expected jump in U.S. consumer confidence and a surprise increase in existing home sales helped turn the major indexes green.

The Commerce Department is expected to wrap up the week with its third and final take on third-quarter GDP on Thursday, to be followed on Friday by its wide-ranging Personal Consumption Expenditures (PCE) report, which will cover income growth, consumer spending and, crucially, inflation.

At 2:12PM ET, the Dow Jones Industrial Average rose 21.61 points, or 0.06%, to 37,579.53, the S&P 500 gained 0.47 points, or 0.01%, to 4,768.84 and the Nasdaq Composite added 32.53 points, or 0.22%, to 15,035.76.

Among the 11 major sectors in the S&P 500 communication services led the gainers, while consumer staples suffered the steepest percentage decline after packaged food company General Mills cut its sales forecast.

FedEx slid 10.9% after the package deliver missed quarterly profit estimates and cut its full-year revenue forecast.

FedEx rival United Parcel Service dipped 0.9%.

Management consulting firm Aon tumbled 5.9% following its announcement that it would buy privately held insurance broker NFP in a $13.4 billion deal.

Advancing issues outnumbered declining ones on the NYSE by a 1.72-to-1 ratio; on Nasdaq, a 1.38-to-1 ratio favored advancers.

The S&P 500 posted 35 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 205 new highs and 72 new lows.

(Reporting by Stephen Culp; Additional reporting by Johann M Cherian and Shristi Achar A in Bengaluru; Editing by David Gregorio)