The stock market closed out a winning week with a narrowly mixed performance Friday after the government reported that Americans' spending rose in April to keep pace with rising costs.
Investors who sent stocks higher for the three preceding sessions turned cautious after the Commerce Department said personal spending and personal income rose 0.2%. The department also said inflation at the consumer level was 0.2%, down from 0.3% in March. Excluding food and energy, April inflation was a tame 0.1%.
The readings were in line with the market's expectations and supported the notion that high commodity costs are not yet causing a sharp pullback in spending or increasing prices for other goods.
Meanwhile, the technology sector got a lift after computer maker Dell and chip maker Marvell Technology Group posted stronger-than-expected quarterly results.
But Wall Street's concerns about the economy and inflation are far from erased despite the stock market's healthy advance this week. Although the government estimated Thursday that first-quarter gross domestic product grew nearly 1%, Americans still face rising costs for necessities such as groceries and gasoline. Furthermore, crude oil remains near record highs -- creating a serious drag on consumer spending.
Investors will get a clearer picture of the economy with reports next week on job growth and manufacturing.
"It is now all about the economy, and I think we're going to get numbers that might be a requiem for the recession forecasters," said Peter Cardillo, chief market economist at New York-based brokerage house Avalon Partners. "Not to say the numbers will be great, but not as bad as people might have anticipated. That will give the market a lift."
The Dow Jones industrial average fell 7.90 points Friday, or 0.1%, to 12,638.32.
Broader stock indicators edged higher. The Standard & Poor's 500 index added 2.12 points, or 0.2%, to 1,400.38, and the tech-dominated Nasdaq composite index climbed 14.34 points, or 0.6%, to 2,522.66.
The Russell 2,000 index of smaller companies gained 2.73 points, or 0.4%, to 748.28.
Declining issues outnumbered advancing issues by about 8 to 7 on the New York Stock Exchange. Volume was light.
Stocks finished higher for the holiday-shortened week, recovering partly from the previous week's sharp losses, as the dollar stabilized and oil prices pulled back from record highs.
