* Russia launches army drills near Ukraine border
* U.S. shares pare early gains made on Apple, Facebook rally
* Dollar loses ground on risk aversion
* U.S. Treasuries yields move lower
(Updates to European close, updates prices)
NEW YORK, April 24 (Reuters) - Global equity markets rose in choppy trading on Thursday in the wake of strong earnings results from tech heavyweights Apple and Facebook, but worries about rising tensions in Ukraine limited gains and dragged the dollar lower.
Apple,, the most valuable U.S. company by market capitalization, rose 8.2 percent to $567.54 a day after posting revenue that far exceeded expectations. Facebook Inc's and Caterpillar Inc's earnings also beat expectations.
"People have been critical of the cash on Apple's balance sheet, but now it has faced up to that criticism. It's doing all the right things, and I don't think a move over $600 would be out of place now," said Michael Binger, senior portfolio manager at Gradient Investments LLC in Minneapolis, which owns Apple.
The strong earnings set the tone for the rise in global share indexes, but rising tensions surrounding Ukraine stifled the advance. Ukrainian forces killed up to five pro-Moscow rebels on Thursday as they closed in on the separatists' military stronghold in the east, while Russia launched army drills near the border in response.
Fears of escalating conflict between Ukrainian troops and pro-Russian rebels in eastern Ukraine have risen since Russia annexed Ukraine's Crimea region last month, and armed protesters in eastern Ukraine have captured several towns.
"Ukraine is a lit stick of dynamite," said Todd Schoenberger, managing partner at LandColt Capital in New York. "All those geopolitical concerns warrant instability and higher commodity prices, and both of those are things Wall Street hates."
The concerns were partially responsible for a quick turnaround in U.S. stocks after a sharp rally at the opening. Facebook and Apple posted their results after Wednesday's market close, and Apple's announcement of a large stock buyback and a stock split motivated buyers to jump into the most valuable U.S. company.
Shares of Facebook were still up modestly on Thursday, while bellwethers Caterpillar, General Motors and Aetna also rose after results.
The dollar slipped against major currencies, hit by the tensions on the Russia/Ukraine border. The dollar had earlier risen broadly after upbeat U.S. durable goods data for March came in above expectations.
European stock markets rebounded from earlier weakness stemming from the Ukraine tensions on signs of a resurgence in corporate takeover activity. The pan-European FTSEurofirst 300 index, which hit a near 6-year high of 1,355.29 points earlier this month, closed up 0.3 percent at 1,343.27 points.
"The merger and acquisition activity we have been seeing is supportive and confirms our view that there is more value left in the European equity market," said Andrew Arbuthnott, head of European large cap equity at Pioneer Investments.
The MSCI world equity index, which tracks shares in 45 nations, rose 0.75 points or 0.18 percent, to 413.35.
The Dow Jones industrial average rose 19.33 points or 0.12 percent, to 16,520.98, the S&P 500 gained 6.34 points or 0.34 percent, to 1,881.73 and the Nasdaq Composite added 29.998 points or 0.73 percent, to 4,156.965.
The dollar index, which tracks the greenback versus a basket of six currencies, fell 0.046 points or 0.06 percent, to 79.809. The dollar was last down 0.21 percent against the yen at 102.3100.
U.S. Treasuries prices edged lower after the data showing stronger-than-expected U.S. durable goods orders reduced safe-haven bids, but the concerns over Ukraine limited losses. The 10-year Treasury note was last down 2/32 to yield 2.695 percent.
Oil prices were higher. Brent crude for June delivery added $1.38 to $110.50 a barrel, while U.S. crude gained 59 cents to $102.03.
Gold futures for June delivery were last up 0.54 percent, at $1,291.6 an ounce.
(Reporting by Sam Forgione; additional reporting by Marc Jones and Sudip Kar-Gupta in London and Ryan Vlastelica in New York; Editing by Dan Grebler and Chizu Nomiyama)