* Morgan Stanley surges over 4 pct after results
* Shares of eBay, Intel fall after disappointing forecasts
* Bernanke continues congressional testimony
* Dow up 0.6 pct, S&P 500 up 0.5 pct, Nasdaq up 0.1 pct
NEW YORK, July 18 The Dow and the S&P 500 climbed to record intraday highs on Thursday, buoyed by a batch of better-than-expected earnings, as congressional testimony by Federal Reserve Chairman Ben Bernanke continued into its second day.
Shares of Morgan Stanley jumped 4.8 percent to $27.80 after the bank posted a 42 percent increase in quarterly profit as stock trading revenue soared. The S&P financial index climbed 1.1 percent.
A jump in shares of UnitedHealth helped lift the Dow and other health insurers. UnitedHealth gained 5.6 percent to $69.93 after the company's results beat expectations, while the Morgan Stanley healthcare payor index rose 2.9 percent.
Analysts' estimates for corporate earnings have been lowered so much that investors believe the low targets should be easily exceeded. Instead, investors will likely hone in on revenue figures and outlooks.
"Corporate America has gotten very good at setting the bar at a level where they can glide over it every quarter, and Wall Street continues to fall for it. So why ruin a good plan?" said Stephen Massocca, managing director at Wedbush Equity Management LLC in San Francisco.
IBM raised its full-year outlook and reported earnings that beat estimates, though the company missed forecasts on revenue. Shares of International Business Machines rose 2.3 percent to $198.99. IBM provided the top boost to the Dow and helped offset a 3.9 percent drop in Intel to $23.19 after the world's biggest chipmaker cut its full-year revenue forecast.
Analysts expect S&P 500 companies' second-quarter earnings to have grown 3.5 percent from a year earlier, with revenue up 1.1 percent, according to Thomson Reuters data.
Of the 81 companies in the S&P 500 that have reported earnings through Thursday so far, 70.4 percent have reported earnings above analysts' expectations, while revenue has topped estimates at a 49.4 percent rate.
The Dow Jones industrial average gained 98.03 points, or 0.63 percent, to 15,568.55. The Standard & Poor's 500 Index gained 8.82 points, or 0.52 percent, to 1,689.73. The Nasdaq Composite Index gained 2.20 points, or 0.06 percent, to 3,612.20.
Both the Dow and the S&P 500 hit new intraday highs shortly after the opening bell. The Dow climbed as high as 15,589.40, while the S&P 500 touched a session high of 1,693.12.
Aside from Intel, the Nasdaq's gains were capped by eBay . The e-commerce company's stock slumped 6.4 percent to $53.74 after eBay said full-year results would be at the low end of its forecast range.
A meeting of Dell shareholders to vote on founder Michael Dell's $24.4 billion offer to take the company private was adjourned to next week. Dell's stock rose 2.3 percent to $13.18.
With the benchmark S&P 500 up nearly 18 percent for the year, investors are alert to any signs of how soon the Federal Reserve will start to wind down the pace of its $85 billion a month in bond purchases, a major driver of the U.S. stock market's rally this year.
Speaking before the House Financial Services Committee on Wednesday, Bernanke stressed that the timeline for winding down the Fed's stimulus program was not set in stone. As the chairman continued his testimony on Thursday before the Senate Banking Committee, he said economic data since the Fed's June meeting has been mixed. But it's too early to make a judgment on the impact for the central bank's forecasts, he added.
"He's done a good job of navigating the waters," Massocca said. "He's got people calmed down about interest rates, but on the other hand, the economy seems to be doing OK."
Our top photos from the last 24 hours.