GLOBAL MARKETS-Wall St choppy as Apple drags; yen slides

* Yen weaker on talk of further Bank of Japan easing

* Dow, S&P 500 higher in choppy trade, Nasdaq (NasdaqGS: NDAQ - news) off 0.4 pct

* European shares hit by disappointing earnings

* U.S (Other OTC: UBGXF - news) . crude settles higher, touches six-month high (Updates with afternoon trading)

By Lewis Krauskopf

NEW YORK, May 12 (Reuters) - The yen lost ground against the U.S. dollar on Thursday amid speculation Japan could expand its monetary stimulus soon, while a drop in Apple (LSE: 0R2V.L - news) shares weighed down the Nasdaq.

Oil prices settled higher after a volatile session which saw U.S. crude touch a six-month high. U.S. Treasury prices fell after comments from a Federal Reserve official suggested interest rates could rise faster than some investors expect.

Stocks were choppy. In afternoon trading, the Dow Jones industrial average was up 33.45 points, or 0.19 percent, at 17,744.57, the S&P 500 had gained 2.08 points, or 0.1 percent, at 2,066.54. The Nasdaq Composite was down 16.48 points, or 0.35 percent, at 4,744.21.

Stocks had posted sharp declines on Wednesday following a strong rally a day earlier.

Apple shares fell 2.4 percent and sank to a two-year low on concerns about iPhone demand. The stock was the biggest drag on all three major indexes.

Gains in consumer staples and telecommunications shares helped counter Apple.

Apple's decline "was a little bit of a psychological wake-up to a lot of people that created some additional pressure," said Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut.

"While we are technically still in a bull market, it's been more of a consolidation for the past year, so when you see your leaders like that turn lower, I think people get a little bit concerned."

Data showed the number of Americans filing for unemployment benefits unexpectedly rose last week to the highest in more than a year, raising further concerns about the health of the labor market.

The pan-European FTSEurofirst stocks index shed 0.6 percent. Shares (Berlin: DI6.BE - news) were weighed down by some disappointing results, including from Dutch insurer Aegon (Swiss: AGN.SW - news) and French bank Credit Agricole (Swiss: ACA.SW - news) .

MSCI (NYSE: MSCI - news) 's global gauge of stocks fell 0.2 percent. The index is off about 1 percent for 2016, with stocks rebounding after a rough start to the year but little changed in recent weeks. Concerns about the global economy persist and investors are responding to diverging policies between the Federal Reserve and other major central banks

The yen fell 0.6 percent against the dollar, pressured by speculation the Bank of Japan could expand its monetary stimulus as soon as next month.

Against a basket of currencies including the yen, the dollar gained 0.4 percent.

U.S. oil prices gained in a volatile session as investors weighed a forecast for tighter global supplies against a signs of another storage build at the hub for U.S. crude futures.

Brent crude settled up 1 percent at $48.08 per barrel. U.S. crude's WTI settled up 1 percent at $46.70. It (Other OTC: ITGL - news) hit a six-month high of $47.02 earlier.

Oil prices have recovered some ground after touching 12-year lows earlier in 2016.

U.S. Treasury prices fell after a Fed official said the U.S. central bank should raise interest rates if data confirms a stronger jobs market and inflation outlook in the second quarter.

The comments by Boston Fed President Eric Rosengren, a voting member this year on the Fed's rate-setting committee, point to growing pressure within the bank to raise rates in coming months.

"The market remains too pessimistic about the fundamental strength of the U.S. economy, and the likelihood of removing monetary accommodation is higher," Rosengren said.

Benchmark 10-year notes were last down 8/32 in price to yield 1.7567 percent, up from 1.73 percent late on Wednesday. (Additional reporting by Karen Brettell, Gertrude Chavez-Dreyfuss and Barani Krishnan in New York, Tanya Agrawal in Bengaluru and Nigel Stephenson in London; Editing by Bernadette Baum and James Dalgleish)