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Apple's blowout results and strong reports from a number of industrials kept sentiment on the bullish side, after investors were on guard for disappointments headed into this week.

Another increase in jobless claims and underwhelming results from General Electric and McDonald's kept gains in check. The S&P 500 ran into resistance close to 1,340, a level that has triggered selling plenty of times this month. Some see a failure to convincingly rise above 1,344, the recent high in the benchmark, as a bearish technical signal.

Volume was light, with about 6.45 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, below last year's daily average of 8.47 billion.

"Objectively, the earnings season is still mixed, but since the most recent results were strong, it increases the perception that we'll have a good first half of the year," said Tommy Huie, who oversees about $34 billion as president and chief investment officer of M&I Investment Management in Milwaukee.

Apple Inc (AAPL.O) rose 2.4 percent to $350.70 a day after posting results that surged past expectations, joining F5 Networks, DuPont and other names that increased the perception of a healthy corporate America after some names' early results disappointed.

Along with GE and McDonald's, the Dow's advance was limited by Verizon Communications Inc (VZ.N). GE shares fell 2.2 percent to $19.95 while Verizon lost 2.3 percent to $36.91 and McDonald's was off 1.9 percent at $76.91.

Factory activity in the U.S. Mid-Atlantic region slowed sharply in April and the number of claims for unemployment insurance fell less than expected last week, implying the economy was struggling to regain momentum.

"That claims didn't decline as much and (factory activity) cooled down suggests that we could be more likely for a pullback," said Donald Selkin, chief market strategist at National Securities in New York. "I don't see how we can maintain these gains."

The Dow Jones industrial average .DJI was up 52.45 points, or 0.42 percent, at 12,505.99. The Standard & Poor's 500 Index .SPX was up 7.02 points, or 0.53 percent, at 1,337.38. The Nasdaq Composite Index .IXIC was up 17.65 points, or 0.63 percent, at 2,820.16.

The Dow climbed as high as 12,506.06, its highest intraday level since early June 2008.

For the week, both the blue-chip index and the S&P 500 are up 1.3 percent while the Nasdaq, lifted by strong tech results, rose 2 percent.

Other notable companies, including Travelers Cos Inc (TRV.N), Morgan Stanley (MS.N) and UnitedHealth (UNH.N), advanced following quarterly results.

Travelers gained 3.7 percent to $61.32 and was the Dow's top gainer while Morgan Stanley rose 1.7 percent to $26.48, DuPont added 1 percent to $55.91 and UnitedHealth rose 8.1 percent to $47.81.

Biogen Idec (BIIB.O) was the S&P 500's top gainer, up 15.2 percent at $99.70, after it released promising data from a clinical trial of an experimental multiple sclerosis drug.

About two stocks rose for every one that fell on the New York Stock Exchange, while on the Nasdaq, about three stocks rose for every two that fell.

(Reporting by Ryan Vlastelica; Editing by Jan Paschal)

The S&P 500 bumped up once more close to 1,340, a level that has triggered selling plenty of times this month. Some see a failure to convincingly rise above 1,344, the recent high in the benchmark, as a bearish technical signal.

But continuing with a recent swing in sentiment, Apple Inc (AAPL.O), up 2.7 percent at $351.51, posted results that smashed Wall Street's expectations. The maker of the iPad and iPhone joined Intel, United Technologies and other names that have increased the perception of a healthy corporate America.

"Companies are proving the concern over expectations was unwarranted because corporate earnings are looking very strong," said Eric Kuby, chief investment officer of North Star Investment Management Corp in Chicago.

Factory activity in the U.S. Mid-Atlantic region slowed sharply in April and the number of claims for unemployment insurance fell less than expected last week, implying the economy was struggling to regain momentum.

"Data is telling you we're experiencing a little bit of a bump, a little bit slower growth," said Anthony Chan, chief economist of J.P. Morgan Private Wealth Management in New York.

But he said there was hidden good news in the "prices paid" component of the Philadelphia Fed survey.

"The slowdown is also going to put a damper on price inflation," he said.

The Dow Jones industrial average .DJI rose 26.30 points, or 0.21 percent, to 12,479.84. The Standard & Poor's 500 .SPX added 5.44 points, or 0.41 percent, to 1,335.80. The Nasdaq Composite .IXIC gained 13.10 points, or 0.47 percent, to 2,815.61.

The Dow climbed as high as 12,496.83, its highest intraday level since early June 2008.

Travelers Cos Inc (TRV.N) gave the Dow its biggest lift after the large property insurer reported a 30 percent rise in quarterly profit as it recorded higher investment income. Shares rose 3 percent to $60.90.

Even Morgan Stanley (MS.N), which reported a near 50 percent drop in profit, posted gains as the decline was smaller than feared, thanks to stronger-than-expected fixed-income trading results. Its shares gained 2.8 percent to $26.77.

But McDonald's Corp (MCD.N) was off 1.7 percent at $77.09, after the world's largest hamburger chain warned of accelerating food price inflation.

General Electric Co (GE.N) lost 2.5 percent to $19.89 as results failed to impress investors even after the largest U.S. conglomerate reported an 80 percent surge in first-quarter profit and raised its quarterly dividend.

Biogen Idec (BIIB.O) was the S&P 500's top gainer, up 18.3 percent at $102.41 after it released promising data from a clinical trial of an experimental multiple sclerosis drug.

UnitedHealth Group Inc's (UNH.N) quarterly profit flew past estimates and its shares jumped 7.9 percent to $47.72. The Morgan Stanley healthcare payor index .HMO gained 3.6 percent, the most in almost eight months.

Volume is expected to remain light on Thursday before a three-day weekend. U.S. and many global markets are closed on Friday in observance of Good Friday.

"As you approach every weekend, there seems to be some concern about being long," said North Star's Kuby. "It's becoming part of the dynamic."

(Reporting by Rodrigo Campos; Editing by Jan Paschal)

This week's revised bid "is substantially the same as what was previously rejected," NYSE Euronext Chairman Jan-Michiel Hessels said in a statement.

In similar language to the board's first rejection on April 10, Hessels said the new offer "does not provide compelling value, has unacceptable execution risk and is therefore not in the best interests of NYSE Euronext shareholders."

NYSE's decision was expected.

Nasdaq and ICE said their bid was superior and that they would continue direct discussions with NYSE shareholders.

"NASDAQ OMX and ICE have directly met each of the specific concerns initially raised by NYSE Euronext's Board and their response is now vague generalities unsupported by the actual facts," the exchanges said in a statement.

The NYSE board reaffirmed its support for a friendly $10.1 billion takeover offer from Deutsche Boerse. Though it is 11 percent lower than the unsolicited $11.2 billion offer from Nasdaq and ICE, NYSE Euronext argues it fits with the company's strategy to grow internationally with more diverse revenues.

Nasdaq and ICE bid for the New York Stock Exchange parent company on April 1. On Tuesday, they promised to pay NYSE Euronext $350 million if regulators blocked a merger -- a pledge meant to ease the board's antitrust worries and draw them to the negotiating table.

The pair -- which were left out of a wave of global merger plans among exchanges earlier this year -- said they secured committed financing for the deal from banks, and said antitrust regulators would start a review soon.

The battle for the Big Board has grown increasingly bitter, and its outcome could revamp ownership of many of the largest market operators in Europe and the United States.

Both offers face tough regulatory reviews on both sides of the Atlantic, complicating things for investors betting on which bid, if any, will prevail.

While NYSE Chief Executive Duncan Niederauer said on Monday competitors were trying to disrupt, distract and discredit his company, Nasdaq CEO Robert Greifeld said on Wednesday he will consider "all options available" as he and ICE pursue NYSE to the "endgame.

Greifeld said in a statement on Thursday he and ICE would not be "deterred by the Board's attempts to protect an inferior transaction."

Deutsche Boerse in a statement on Thursday that it is moving ahead with its integration planning. It called Nasdaq and ICE's unsolicited proposal "lacking in business logic" and "a major step backward in the evolution of the global exchange industry."

NYSE shareholders are set to meet on April 28 for their annual vote on the company's directors. A vote on the Deutsche Boerse tie-up is planned for July.

(Reporting by Jonathan Spicer. Additional reporting by Clare Baldwin. Editing by Gerald E. McCormick, Dave Zimmerman and Robert MacMillan)

Apple Inc (AAPL.O) climbed 2.6 percent to $351.20 after its results beat Wall Street's expectations as iPhone and Mac computer sales soared while iPad supplies could not keep up with global demand.

Travelers Cos Inc (TRV.N) provided the top boost to the Dow after reporting a 30 percent rise in quarterly profit as the large property insurer recorded higher investment income. Shares rose 3.3 percent to $61.07.

But McDonald's Corp (MCD.N) was off 2.1 percent to $76.78, after the hamburger chain warned of accelerating food inflation.

Stocks pared gains after the Philadelphia Federal Reserve said the pace of factory activity in the mid-Atlantic region fell far more than expected in April after expanding at its fastest pace in 27 years in March.

The benchmark S&P 500 index has met strong resistance at various times in April as it approached 1,344, which it previously hit in February. That was its highest since June 2008.

"The Philly Fed contributed to the (drop) as much as anything," said Uri Landesman, president of Platinum Partners in New York.

"1,344 is a real level. This has definitely been a Pollyannish market -- it is going to take a lot of good news and not just happy feet to bust through 1,344."

The Dow Jones industrial average .DJI gained 19.72 points, or 0.16 percent, to 12,473.26. The Standard & Poor's 500 Index .SPX gained 4.47 points, or 0.34 percent, to 1,334.83. The Nasdaq Composite Index .IXIC gained 9.80 points, or 0.35 percent, to 2,812.31.

General Electric Co (GE.N) lost 2.3 percent to $19.93 even after the largest U.S. conglomerate reported an 80 percent surge in first-quarter profit and raised its quarterly dividend.

Morgan Stanley, the second-largest U.S. investment bank, rose 3.3 percent to $26.89 after reporting its first-quarter results.

In other economic data, a government report showed new U.S. unemployment benefits claims held above the key 400,000 level while an index of future U.S. economic health rose for a ninth straight month in March.

Volume is expected to remain light on Thursday before a three-day weekend. U.S. markets are closed on Friday in observance of Good Friday.

(Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)

The bank's shares rose 3.5 percent, even as the bank posted a nearly 50 percent decline in earnings.

Revenue in bond trading, long a troubled business for the bank, fell 35 percent from the same quarter last year, which was an unusually strong quarter across Wall Street.

"Morgan Stanley definitely still has a lot of work to do on revamping the fixed income trading desk. But this quarter is a testament to the progress they've made," said Shannon Stemm, a stock analyst at brokerage Edward Jones.

The bond trading business generated big losses for the bank during the financial crisis, and then lagged rivals during a recovery in 2009.

Chief Executive James Gorman is pushing the division to gain market share and improve its performance.

In an interview with Reuters Thursday morning, Chief Financial Officer Ruth Porat said the division performed well in trading currencies and interest rate products like government debt, two key areas for Morgan Stanley's turnaround effort.

"We're making progress," she said.

She attributed the decline in overall fixed-income trading to weak client volumes in areas like corporate bond trading.

Overall, Morgan Stanley posted quarterly net income for shareholders of $736 million, or 50 cents a share, down from $1.41 billion, or 99 cents a share, a year earlier. Revenue fell 16 percent to $7.6 billion.

Some businesses performed well. The wealth management group, a joint venture with Citigroup Inc, posted income for Morgan Stanley of $183 million, up 85 percent. The group reported 7 percent growth in client assets.

The bank's quarterly results included several special items, including an after-tax loss of 26 cents a share from its stake in a Japanese securities joint venture, and a gain of 30 cents a share linked to selling its stake in a stalled casino project in Atlantic City, New Jersey.

It was not immediately clear how the bank's bottom line compared to the average Wall Street forecast, given the special items and the fact that not all analysts included the Japanese joint venture losses in their forecasts.

Most Wall Street banks have posted weaker fixed income revenue after a blow-out quarter a year earlier. The broad decline across Wall Street may have helped soften the blow for Morgan Stanley.

Goldman Sachs Group Inc posted a 28 percent decline for its fixed income customer trading business, while JPMorgan Chase & Co posted a decline of just 4 percent.

Morgan Stanley shares were up 91 cents to $26.95 in morning trading.

(Reporting by Lauren Tara LaCapra, additional reporting by Dan Wilchins; editing by John Wallace)

* By 4:44 a.m., futures for the S&P 500, for the Dow Jones industrial average and for the Nasdaq rose 0.4 to 0.9 percent.

* Earnings surprises lifted stocks on Wall Street to their best day in a month on Wednesday.

*The Dow .DJI rose to its highest in almost three years and the S&P 500 .SOX broke decidedly above its 20-day moving average, setting a near-term target at 1,340, according to its Bollinger bands chart, a technical indicator that tracks momentum and volatility.

* Continuing the upbeat mood after markets closed, iPhone-maker Apple Inc (AAPL.O) posted results that surged past analysts' forecasts.

* Further earnings are expected to dominate the trading session, with bellwether General Electric (GE.N) and lender Morgan Stanley (MS.N) among the major firms scheduled to release results before markets open.

* GE's profit is expected to rise to 28 cents per share from 21 cents per share one year ago, while Morgan Stanley is seen posting earnings of 34 cents, down from $1.03 a year ago.

* Hamburger chain McDonald's (MCD.N) will also report earnings, with focus likely to be on its power to raise prices as food and fuel costs climb. Analysts expect a 2 percent rise in March sales at established U.S. restaurants.

* Economic data is also likely to provide direction for equities in the last day of trading of the week ahead of the Good Friday holiday.

* Weekly jobless claims are due at 1230 GMT, while February home prices data and the Philadelphia Fed's index of business conditions for the U.S. Mid-Atlantic region for April are both due at 1400 GMT.

* In company news, BP (BP.N) has filed a lawsuit against Halliburton (HAL.N), the company that cemented the blown-out well which caused the Gulf of Mexico oil spill, a day after claiming $40 billion from rig owner Transocean (RIG.N).

* Italian automaker Fiat SpA (FIA.MI) has agreed to pay $1.27 billion euros for another 16 percent stake in U.S. peer Chrysler this quarter, the Italian automaker said on Thursday, in a deal that was faster and cheaper than expected.

* Schneider Electric SA's (SCHN.PA) chief executive essentially ruled out a takeover of Tyco International Ltd (TYC.N) by saying the French engineering giant does not plan any purchases larger than a "few billion euros" over the next year.

* In Europe, the pan-European FTSEurofirst 300 .FTEU3 index of top shares edged higher in early trade, with technology shares gaining on the back of Apple's upbeat results.

* Dollar weakness continued to underpin commodity prices, with gold hitting record highs for the fifth day as the dollar index slipped to a three-year low.

(Reporting by Harpreet Bhal; Editing by Jon Loades-Carter)