US STOCKS-Dow transports hit record, lifting Wall St

                                

                                
 * DJ Transports hit all-time high
                                
 * U.S. economic growth slows, inflation surges
                                
 * Silver soars to record high
                                
 * Dow up 0.6 pct, S&P up 0.4 pct, Nasdaq up 0.1 pct
                                
 * For up-to-the-minute market news see [STXNEWS/US]
 (Adds Microsoft and Research in Motion after the bell)
                                
 By Chuck Mikolajczak
                                
 NEW YORK, April 28 (Reuters) - The Dow Jones transports
closed at an all-time high on Thursday, leading U.S. stocks
higher and signaling more gains due to its role as a
touchstone of economic demand.
                                
 The Dow Jones Transportation Average <.DJT> rose 1.2
percent to 5,510.06, led by Norfolk Southern <NSC.N>, which
jumped 8 percent to $73.87 after reporting strong results. For
details, see [ID:nN27183999]    
                                
 Investors had expectations for strong gains after the S&P
500 broke through resistance at 1,344 on Tuesday. However,
with volume weak and economic data suggesting a still unsteady
path to recovery, it raises questions as to how fast the S&P
can surpass the next milestone at 1,400.
                                
 "There is a disconnect in the market right now -- we are
getting this mixed bag of news," said Jonathan Corpina, head
of NYSE floor operations for Meridian Equity Partners in New
York.
                                
 There were also some signs of creeping cost pressures in
some companies' results. Procter & Gamble Co <PG.N> lowered
the high end of its profit forecast as it trimmed expenses and
increased prices to offset rising materials costs. Its shares
were up 0.8 percent at $64.50.  [ID:nN28183619]
                                
 Earnings eased the blow from a batch of soft economic data
showing U.S. economic growth had slowed and the labor market
may be weakening. [ID:nCAT005418]
                                
 But the U.S. Federal Reserve has maintained support for
its easy monetary policy, which has helped push up equity
prices in the face of increasing inflation. [ID:nN28268058]
                                
 "As operating costs continue to move higher across the
board, that is clearly going to affect the bottom line moving
forward," Corpina said.
                                
 "Seeing commodity prices, oil and energy prices at the
rate they are trading at now, with no end in short-term sight,
that has to be factored in, going into the next quarter or
two."
                                
 The Dow Jones industrial average <.DJI> rose 72.35 points,
or 0.57 percent, to 12,763.31. The Standard & Poor's 500 Index
<.SPX> added 4.82 points, or 0.36 percent, to 1,360.48. The
Nasdaq Composite Index <.IXIC> advanced 2.65 points, or 0.09
percent, to 2,872.53.
                                
 RIMM DIVES LATE, MICROSOFT DROPS
                                
 After the closing bell, U.S.-listed shares of Research in
Motion <RIM.TO><RIMM.O> tumbled 10 percent to $50.94 after the
BlackBerry maker cut its earnings outlook for the current
quarter, while Microsoft Corp <MSFT.O> shed 2 percent to
$26.19 after posting quarterly earnings.
[ID:nN28285540][ID:nN28287884]
                                
 During the session, insurers moved higher as Allstate Corp
<ALL.N>, up 5.7 percent at $33.76, and Aflac Inc <AFL.N>, up 5
percent at $57, advanced on quarterly results. Health insurer
Aetna <AET.N> gained 4.2  percent to $41.48 following
quarterly results that topped Wall Street's expectations.
[ID:nN27172823] [ID:nL3E7FR4U8] [ID:nN28248347]
                                
 The KBW insurance index <.KIX> climbed 2 percent and the
Morgan Stanley healthcare payor index <.HMO> added 1.9 percent.
                                
 "We are kind of getting in that stage where we've had a
lot of good earnings reports. The market really likes that,
but as we are getting through earnings season, they are going
to start focusing more on these economic numbers," said Peter
Jankovskis, co-chief investment officer of OakBrook
Investments LLC in Lisle, Illinois.
                                
 "The fact we've had this string of economic numbers that
are at par, sub-par, however you want to put it, is going to
cause people to be looking more at the individual companies.
It's not 'a rising boat lifts all ships story' any more."
                                
 Silver soared to an all-time high and gold rose to another
record, as a falling dollar and signs that the Federal Reserve
would maintain a loose monetary policy boosted precious
metals' appeal as a hedge against inflation and economic
uncertainty.
                                
 Other economic data showed pending sales of existing U.S.
homes were much stronger than expected in March, offering
faint glimmers of hope for the depressed U.S. housing market.
[ID:nN28270253]
                                
 Volume was modest, with about 7.49 billion shares traded
on the New York Stock Exchange, NYSE Amex and Nasdaq, slightly
below the daily average of 7.73 billion.
                                
 Advancing stocks outnumbered declining ones on the NYSE by
1,838 to 1,144, while on the Nasdaq, advancers beat decliners
1,437 to 1,129.
  (Reporting by Chuck Mikolajczak; Editing by Jan Paschal)