Wall Street rises on bright tech outlooks, earnings

NEW YORK (Reuters) - Stocks rose on Thursday, with the S&P 500 at fresh 2-1/2 month highs as technology-sector outlooks and earnings overshadowed weak economic data.

A raised full-year outlook from IBM , forecast-beating earnings from eBay and Qualcomm's expectations for a "strong December quarter" boosted technology shares.

The market briefly pared gains in early trading after data showed manufacturing in the U.S. mid-Atlantic region shrank for a third month and home resales were lower than forecast. Separate data showed more Americans applied for unemployment insurance than expected in the latest week.

"It is baked into stock prices that growth is going to be slow for a little while," said Giri Cherukuri, head trader at OakBrook Investments in Lisle, Illinois.

"People are focusing on individual stocks after earnings and trying to figure out (through) outlooks how weak the economy really is," he said.

Record high prices in Treasuries have kept yield-seekers focused on stocks despite a softening economy.

A vigilant Federal Reserve is also credited for helping equities hold amid poor economic data, as previous Fed actions to bolster the economy have triggered rallies in equity and commodity markets.

The Dow Jones industrial average <.DJI> rose 45.94 points, or 0.36 percent, to 12,954.64. The S&P 500 Index <.SPX> gained 5.90 points, or 0.43 percent, to 1,378.68. The Nasdaq Composite <.IXIC> added 30.27 points, or 1.03 percent, to 2,972.87.

IBM shares jumped 3.8 percent to $195.35, making it the largest boost to the Dow industrials a day after it raised its full-year profit forecast.

Qualcomm cut its revenue and earnings forecast for the current quarter but investors took heart as it said sales would improve for a strong last quarter of 2012, sending its shares up 4.1 percent to $58.35.

EBay shares jumped 9.2 percent to $44.20 after it posted stronger-than-expected quarterly revenue and earnings as more consumers shopped on its online marketplaces and used its PayPal payment service.

U.S.-traded shares of Mellanox Technologies touched their life high after the chipmaker's profit beat analysts' expectations. Mellanox, up about 40 percent at $92.61, was the biggest boost to the PHLX semiconductor index <.SOX>.

Outside the tech sector, Textron shares rallied 10.8 percent to $26.32 after the world's largest maker of corporate jets, which also makes EZ-Go golf carts and industrial components, handily beat Wall Street forecasts.

Walgreen shares soared 10.7 percent to $34.28 and Express Scripts Holding added 2.7 percent to $59.23 after the companies said they struck a pharmacy network agreement that settles a long-running dispute.

Walgreen competitor CVS Caremark fell 5.1 percent to $45.97.

Morgan Stanley fell 4.9 percent to $13.30 as quarterly revenue declined due to a slowdown in trading and dealmaking volumes.

Johnson Controls shares tumbled 6 percent to $26.63 after it posted a lower-than-expected quarterly profit and cut its outlook for the current period.

Google shares rose 2.9 percent to $597.63. The company reports its earnings after the closing bell.

(Editing by Bernadette Baum, Dave Zimmerman)

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