(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window.) * Apple, Amazon fall on dismal holiday-quarter forecast * Microsoft tops Apple as the most valuable U.S. public company (Updates to market close) NEW YORK, Oct 29 (Reuters) - U.S. stocks shook off early declines and closed out the last trading day of the month with modest gains as a rise in Microsoft helped offset declines in Amazon and Apple after disappointing quarterly earnings from the online retailer and iPhone maker. Microsoft’s shares touched a record high and neared a market capitalization of $2.5 trillion, surpassing Apple Inc’s market cap of roughly $2.46 trillion. Apple dropped after it warned the impact of supply-chain disruptions will be even worse during the current holiday sales quarter, while Amazon.com Inc lost ground as it forecast downbeat holiday-quarter sales amid labor shortages. “The takeaway from today is the resilience to the overall index despite 10% of market cap in two companies disappointing and yet the market is flat. It’s the resilience of the marketplace, it suggests to me the trend is still intact,” said David Joy, chief market strategist at Ameriprise Financial in Boston. “Maybe the numbers were a surprise to the analyst community but not the reasons for the disappointment so there is still a general view that this is not business lost but business postponed and the trend in the economy and in the market continues to be to the upside.” According to preliminary data, the S&P 500 gained 8.48 points, or 0.18%, to end at 4,604.90 points, while the Nasdaq Composite gained 48.66 points, or 0.32%, to 15,496.78. The Dow Jones Industrial Average rose 88.36 points, or 0.25%, to 35,818.84. The S&P 500 had fallen as much as 0.65% earlier in the day. The benchmark index advanced for a fourth straight week, its longest weekly streak of gains since April. Apple had risen about 2.5% while Amazon gained 1.6% in Thursday’s session, helping to send the S&P 500 and Nasdaq to closing record highs. With 279 companies in the S&P 500 having reported results through Friday morning, 82.1% have topped earnings expectations, according to Refinitiv data. The current year-over-year earnings growth rate for the third quarter is 39.2%. Market participants have been closely attuned to the ability of companies to maneuver through labor shortages, rising price pressures and clogs in the supply chain, and a solid earnings season has helped investors overlook a mixed macroeconomic picture with a Federal Reserve that is poised to begin to trim its massive bond purchases soon. The central bank’s next policy announcement is on Nov. 3. Data showed U.S. consumer spending increased solidly in September, while inflation pressures are broadening. The data indicated the jury is still out on whether the Fed’s “transitory” view on inflation will hold true. AbbVie Inc advanced as the U.S. drugmaker raised its 2021 adjusted profit forecast for the third time this year. Starbucks Corp tumbled after the coffee chain said it expects fiscal 2022 operating margin to be below its long-term target due to inflation and investments. Reporting by Chuck Mikolajczak in New York Editing by Matthew Lewis