The S&P 500 and Dow were slightly lower on Friday, weighed by renewed concerns over euro zone debt after Ireland's credit rating was slashed.

European bank stocks were hit hard after Moody's cut Ireland's rating by five notches. European Union leaders have agreed to create a financial safety net and the European Central Bank will double its capital to cope with bigger credit risk.

U.S.-listed shares of Allied Irish Bank fell 4 percent to $1.25, while Barclays dropped 2.4 percent to $16.20.

Obviously everyone is focusing on Europe, but since it has been with us for awhile, the market is not too concerned. We are more consolidating some of the gains we saw this month, said Mark Bronzo, portfolio manager at Security Global Advisors in New York.

The Dow Jones industrial average <.DJI> was down 29.37 points, or 0.26 percent, at 11,469.88. The Standard & Poor's 500 Index <.SPX> was down 1.77 points, or 0.14 percent, at 1,241.10. The Nasdaq Composite Index <.IXIC> was up 1.18 points, or 0.04 percent, at 2,638.49.

U.S. regional banks traded higher after Canada's Bank of Montreal agreed to buy Wisconsin-based regional lender Marshall & Ilsley Corp . Marshall & Ilsley jumped 19 percent to $6.89.

The KBW Regional Banks index <.KRX> was up nearly 1 percent. It has risen more than 13 percent this year, including a gain of more than 12 percent in December alone despite continued debt woes from European banks.

Mergers and acquisitions rose for the first year since 2007, and may mark the start of a new, multiyear M&A cycle, with emerging economies accounting for a bigger piece of global dealmaking, according to Thomson Reuters data.

With the S&P 500 up 5 percent in December, some technical analysts say the market is due for a pullback before the year's end.

The index's uptrend is intact, but upside potential narrows as momentum becomes increasingly overbought, said BBH Equity Trading in a research note to clients.

Near-term resistance and support for the S&P 500 are 1,247 and 1,233, respectively ... 1,265 and 1,220 are the levels to watch if this range is broken.

Oracle Corp shares jumped 5.8 percent to $32 a day after the software maker issued an upbeat forecast and reported that quarterly sales surged.

Market volume and volatility could increase later in the day as traders adjust or exercise derivative positions on four different types of expiring equity futures and options contracts, also know as quadruple witching.

(Reporting by Angela Moon; editing by Jeffrey Benkoe)