US STOCKS-Wall St struggles for direction after Greek plan

* S&P above 1,311 on Greek hopes, investors eye level

* Moody's warns U.S. default risk rising

* Jobless claims drop, but less than estimates

* Dow off 0.2 pct, S&P off 0.1 pct, Nasdaq up 0.1 pct

* For up-to-the-minute market news see [STXNEWS/US] (Updates to afternoon trading, changes byline)

By Ryan Vlastelica

NEW YORK, June 2 (Reuters) - U.S. stocks rebounded from early lows but struggled to find direction on Thursday as news of fresh help for Greece calmed investors worried about the economic outlook ahead of a key jobs report.

Senior euro zone officials tentatively agreed on a new three-year adjustment plan for Greece, according to a source. The S&P 500 recouped some lost ground on the news after earlier taking out its May low at 1,311.80. For details, see [ID:nLDE7510BM]

"Markets are focused on two 'Es' right now: Europe and employment, and if there's stability in those, that will lead to greater market confidence," said Tom Galvin, managing director and lead portfolio manager at Columbia Management in Stamford, Connecticut.

The Dow Jones industrial average <.DJI> was down 25.05 points, or 0.20 percent, at 12,265.09. The Standard & Poor's 500 Index <.SPX> dipped 0.77 points, or 0.06 percent, at 1,313.78. The Nasdaq Composite Index <.IXIC> was up 2.79 points, or 0.10 percent, at 2,771.98.

Nervous investors focused on key market levels to manage risk ahead of Friday's non-farm payroll report. Data showing stubbornly high jobless claims and mixed chain-store sales gave investors little reason to get back into the market after a string of weak economic data sparked equities' worst one-day fall in nearly a year on Wednesday.

Traders are honing in on the May low as near-term support. If that level is broken at the close, it could open the window to a move back to the April low at 1,294, and the March lows near 1,250 to 1,260, the index's 200-day moving average.

"The market is trying to stabilize from the whiplash we had yesterday, but we need to see further gains in employment to see a move in the market out of this range," Galvin said.

Initial jobless claims slipped 6,000 to a seasonally adjusted 422,000 in the latest week, while economists polled by Reuters had forecast 415,000. [ID:nN02246578]

Friday's non-farm payroll report is expected to show 150,000 jobs added in May, according to a Thomson Reuters poll of economists. A weak read by ADP on private employers on Wednesday prompted many analysts to sharply scale back their forecasts.

Bank stocks stabilized after falling on news that Goldman Sachs Group Inc was subpoenaed by New York prosecutors seeking information on its role leading into the global financial crisis. Goldman's stock fell 1.4 percent to $134.26, while the KBW Banks index <.BKX> rose 0.4 percent after falling earlier. [ID:nN02257268]

Moody's Investors Service said there was a small but rising risk of a short-lived default by the United States if the government's statutory debt limit was not increased in coming weeks. As the risk was not seen as large, equities had little reaction to the announcement. [ID:nN02274698]

Retailers reported growth in May same-store sales, though the growth was less robust than expected as consumers were hit by high gasoline prices. Gap Inc fell 3.3 percent to $18.28, while Costco Wholesale Corp lost 1 percent to $79.40. Luxury retailer Tiffany & Co rose 0.5 percent to $73.79. [ID:nN02231116]

"There were some decent retail results, especially at the high end, which suggests that the consumer is by no means in a foxhole," Galvin said.

Strength in education stocks supported the Nasdaq after U.S. officials relaxed rules that could have cut off tuition aid to programs run by for-profit colleges. [ID:nL3E7H21RM]

Corinthian Colleges Inc surged 27 percent to $5.07. Apollo Group Inc jumped 9.6 percent to $46.23 and was one of the top gainers on the S&P consumer discretionary sector. (Editing by Jeffrey Benkoe)