US STOCKS-U.S. stocks hit record highs as energy, materials climb

* Dollar down for second straight day

* Fed to release minutes of July meeting on Wednesday

* Philadelphia semiconductor index hits 16-year high

* Indexes up: Dow 0.5 pct, S&P 0.4 pct, Nasdaq (NasdaqGS: NDAQ - news) 0.7 pct (Updates to late afternoon)

By Caroline Valetkevitch

Aug 15 (Reuters) - U.S (Other OTC: UBGXF - news) . stocks rose again to all-time highs on Monday, extending their record-setting climb of the past few weeks as a rally in oil lifted energy shares, while materials also gained.

Oil rose to five-week highs, driving the S&P 500 energy index up 0.7 percent, while other commodity-related shares also rose as the U.S. dollar eased. The S&P 500 materials index gained 1.1 percent.

Expectations that the Federal Reserve will continue to keep rates low have helped stoke investor appetite for U.S. stocks, and analysts say a better-than-expected earnings picture could propel further gains in stocks.

"We're moving from an interest-rate-driven bull market to an earnings-driven secular bull market," said Jeffrey Saut, chief investment strategist at Raymond James Financial (NYSE: RJD - news) in St. Petersburg, Florida. He said earnings should pick up this year and continue to improve "over the next few years."

At 2:50 p.m. ET, the Dow Jones industrial average was up 84.2 points, or 0.45 percent, to 18,660.67, the S&P 500 had gained 9.13 points, or 0.42 percent, to 2,193.18 and the Nasdaq Composite had added 35.44 points, or 0.68 percent, to 5,268.34.

Since July, the S&P 500 index has registered a string of record intraday highs.

The Federal Reserve on Wednesday releases minutes of its July meeting that could provide clues on its plans to raise interest rates and its view on the health of the economy.

Still, traders are largely skeptical of a rate hike in the near term, with U.S. inflation below the Fed's 2 percent target and as central banks worldwide unleash stimulus programs to support their economies.

The odds of a hike in September stand at 12 percent, rising to about 38 percent for December, according to CME Group (Kuala Lumpur: 7018.KL - news) 's Fedwatch tool.

Post Properties (NYSE: PPS - news) hit a record high after the company agreed to be bought by Mid-America Apartment Communities for about $3.88 billion. Mid-America's shares fell 5.8 percent.

Xylem (NYSE: XYL - news) rose 4.1 percent to $50.46 after the water technology company said it would buy Sensus USA for about $1.7 billion in cash.

The Philadelphia semiconductor index touched a 16-year high.

Twitter (Xetra: A1W6XZ - news) rose 6.7 percent to $20.84 after the New (KOSDAQ: 160550.KQ - news) York Times reported the company was in talks to bring its app to the Apple TV platform.

Advancing issues outnumbered declining ones on the NYSE by a 2.11-to-1 ratio

The S&P 500 posted 34 new 52-week highs and no new lows; the Nasdaq Composite recorded 144 new highs and 25 new lows. (Additional reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva and Dan Grebler)