The Nasdaq and S&P 500 rose modestly on Friday on relief that the financial regulation bill wouldn't crimp Wall Street profits as badly as feared and as tech company Oracle's strong results revived hopes about business spending.
Despite the day's gains, the main stock indexes fell for the week after two straight weeks of gains and recorded their weakest performance in five weeks.
Banks climbed after lawmakers agreed on rules that did not make dramatic changes to derivatives and proprietary trading, two highly profitable businesses in lawmakers' crosshairs. The bill must still be approved by both chambers of Congress before it can be signed into law.
JPMorgan Chase & Co rose 3.7 percent at $39.44 while Bank of America Corp gained 2.7 percent to$15.42.
The S&P financial sector <.GSPF>, which is down 8.4 percent over the past quarter, rose 2.8 percent.
Regulation is less onerous than people's fears, so you're seeing a bit of a relief rally in the financials today, which obviously is helping, said Michael James, senior trader at Wedbush Morgan in Los Angeles.
Oracle Corp gained 1.7 percent to $22.60 a day after it posted a stronger-than-expected quarterly profit on solid sales of new software.
This could be a sign of a pick-up in tech spending, which may mean other tech firms are going to report strong numbers, said Andy Fitzpatrick, director of investments at Hinsdale Associates in Hinsdale Illinois.
The Dow Jones industrial average <.DJI> was down 8.99 points, or 0.09 percent, at 10,143.81. The Standard & Poor's 500 Index <.SPX> was up 3.07 points, or 0.29 percent, at 1,076.76. The Nasdaq Composite Index <.IXIC> was up 6.06 points, or 0.27 percent, at 2,223.48.
The Dow fell 2.9 percent for the week, the S&P 500 was off 3.6 percent and the Nasdaq Composite fell 3.7 percent.
The Dow edged lower on Wal-Mart Stores Inc , which fell 2.5 percent to $48.80.
The week's high and low points covered a wider span than last week's. Closing below the previous week's low in an outside week is seen as a technical bearish signal.
It looks like we're stuck in this trading range, with the downside (on the S&P) around 1,040 to 1,050 and upside capped by the 50 day moving average, which right now is around 1,127 said Michael Sheldon chief market strategist, RDM Financial, Westport, Connecticut.
In economic news, a survey showed that consumer sentiment rose more than expected while a government report showed first-quarter gross domestic product was slower than previously estimated.
The market was already worried about a downturn, and the GDP data will highlight the idea that we should be concerned about a slowdown, said Chip Hanlon, president at Delta Global Advisors in Huntington Beach, California.
Crude oil surged 3.2 percent to $78.91 per barrel on concerns that a tropical disturbance in the Caribbean may develop into a storm and threaten Gulf of Mexico production.
At the same time, U.S.-listed shares of BP Plc tumbled to a 14-year low as it continued to struggle to contain its oil spill in the Gulf of Mexico and the storm threatened to disrupt the effort.
Some major companies announced disappointing earnings. BlackBerry maker Research in Motion Ltd was the biggest drag on the Nasdaq 100 <.NDX>, with its U.S.-traded shares down 11 percent to $52.23 a day after reporting weaker-than-expected shipments and subscribers.
KB Home slumped 9 percent to $11.12 after the homebuilder reported a wider-than-expected quarterly loss.
About 13.5 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, the highest
volume in a month and above last year's estimated daily average of 9.65 billion.
The heavy volume came as the Russell Investment Group finalized the annual overhaul of its indexes.
Advancing stocks outnumbered declining ones on the New York Stock exchange by a ratio of 11 to 4 while on the Nasdaq 9 stocks rose for every 4 that fell.