US blue chips ended higher on Friday after comments from a top Federal Reserve official eased fears of an early interest-rate hike, but technology stocks sagged after disappointing news from bellwethers International Business Machines Corp and Nokia Corp.
General Electric Co and Wal-Mart Stores Inc were the two biggest contributors to gains in the Standard & Poor's 500, but weakness in IBM capped the blue-chip Dow's rise.
On Friday, Richmond Federal Reserve Bank President Alfred Broaddus said the central bank was "some distance" from tightening monetary policy to choke off a future inflation threat. Broaddus also said he wanted more confirmation that economic growth would be sustained.
His comments were the latest from the Fed, which has sought to ease worries it will be eager to lift official interest rates from historically low levels, even after a batch of surprisingly strong economic readings this week.
"We had some encouraging news from the Fed. People have overreacted to data we got in the last few weeks, assuming that just because we had one month of a jump in inflation, we're going to continue to see that," said Ed Peters, chief investment officer of PanAgora Asset Management Inc. in Boston.
The Dow Jones industrial average rose 54.51 points, or 0.52 percent, to 10,451.97, while the Standard & Poor's 500 Index added 5.73 points, or 0.51 percent, to 1,134.57.
The technology-laced Nasdaq Composite Index ended down 6.43 points, or 0.32 percent, at 1,995.74.
For the week, the Dow rose 0.10 percent. But the S&P 500 and Nasdaq each notched their second straight down week. The S&P 500 declined 0.4 percent, while the Nasdaq fell 2.8 percent.
Traders attributed some of the market's moves to the expiration of options, an event that can add to volatility in the market. April individual equity options and some stock- index options stopped trading at Friday's close.
"Part of the gains have to do with options expiration. A lot of it is unwinding of option positions between now and the end of the day," said John O'Donoghue, co-head of listed trading at Credit Suisse First Boston. "It's very quiet otherwise."
Volume was active, with about 1.49 billion shares changing hands on the New York Stock Exchange, and roughly 1.87 billion shares traded on the Nasdaq. Advancers beat decliners by a ratio of about 8 to 3 on the NYSE, and by roughly 16 to 15 on the Nasdaq.
Nokia topped the New York Stock Exchange's most active list after warning that its second-quarter earnings would fall and sales could also drop.
Nokia, based in Finland, also said margins at its key mobile phones unit would be hit until its more competitive models hit stores.
Shares of Nokia, the world's biggest cell phone maker, lost $1.44, or almost 9 percent, to $14.61.
IBM shares fell a day after it reported its crucial services division had disappointing profits and shortfalls in new services contracts, a closely watched indicator of future business. Shares of IBM, the world's largest computer company, fell $1.69, or 1.8 percent, to $92.28 and led the Dow's percentage losers.
On the Nasdaq, Netflix Inc shares sank one day after the online DVD rental company posted a wider quarterly net loss due to higher marketing costs. But the company raised its earnings forecast because of higher fees. Shares of Netflix plummeted $6.27, or 16.9 percent, to $30.75 and were the biggest drag on the Nasdaq.
In economic news, US industrial production unexpectedly fell in March while consumer sentiment slipped this month, but economists downplayed the two disappointing reports and said the economy's expansion remains on track.
Industrial production dipped 0.2 percent in March, a decline that the Fed attributed to a drop in utilities' output due to "unseasonably warm weather."
But the warm weather helped the housing market, with new starts posting the biggest monthly gain in March since May 2003. Homebuilders broke ground at a seasonally adjusted rate of 2.007 million units last month, up 6.4 percent from February, the Commerce Department said.
In a third report, the University of Michigan said its preliminary index of consumer sentiment in April dipped to 93.2 from 95.8 in March, as worries about jobs, high gasoline prices and an escalation of violence in Iraq hurt confidence, economists said.