The S&P 500 and Nasdaq fell on Thursday as worse-than-expected jobless claims offset generally positive earnings reports.

The Dow industrials rose, lifted by solid results from several components, including 3M, Travelers and McDonald's.

The number of workers filing new jobless claims rose by 11,000 last week, indicating the labor market remained fragile despite signs of an economic recovery.

People are starting to say 'Is this real and can this continue? said Doug Roberts, chief investment strategist at Channel Capital Research.com in Shrewsbury, New Jersey.

Particularly with the government, with the unemployment numbers, people are getting nervous about that.

The Dow Jones industrial average <.DJI> gained 28.03 points, or 0.28 percent, to 9,977.39. The Standard & Poor's 500 Index <.SPX> dropped 1.32 points, or 0.12 percent, to 1,080.08. The Nasdaq Composite Index <.IXIC> shed 10.18 points, or 0.47 percent, to 2,140.55.

United Parcel Service Inc slipped 1.2 percent to $56.44 after the economic bellwether reported sharply lower earnings but still topped expectations on cost cutting, and said its outlook for the holiday season remained unclear.

Travelers Cos Inc , the largest U.S. publicly traded property-casualty insurer, said profit jumped fourfold and approved a new $6 billion share buyback plan. The stock rose 5.4 percent to $50.60.

3M Co gained 2 percent to $77.88 after the diversified manufacturer reported stronger-than-expected earnings and raised its full-year forecast on demand for consumer electronics and respiratory masks.

McDonald's Corp advanced 3.3 percent to $60.29 after the fast-food chain posted stronger-than-expected income and said global comparable sales rose.

Union Pacific Corp reported better-than-expected earnings as the No. 1 U.S. railroad said a year-long drop in freight volumes tied to the recession appears to have stabilized. The stock fell 2.2 percent to $61.57.

(Reporting by Chuck Mikolajczak; editing by Jeffrey Benkoe)

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