Eight Is Enough for Dow

Looking ahead, investors may need to dig a little deeper to find value as the economic recovery continues, said Arthur Hogan, chief market analyst at Jefferies.

"As the recovery matures, we should see shifts to software from semiconductors and to consumer durables from consumer staples," Hogan said. Consumers and corporations "will buy more of what they want, rather than just what they need," he said.

Hogan also expects investors to focus on areas with higher quality earnings. "During the first year of the bull market, investors poured money into businesses that had been struggling but managed not to go out of business, like AT&T Wireless (AWE Quote) and Lucent (LU Quote)," noted Hogan. "In the second year of a bull market, it is typical for people to shift money to names that make money year after year, like Intel (INTC Quote) and Microsoft (MSFT Quote)."

Movers

In earnings, Weyerhaeuser (WY Quote) announced a quarterly profit of 47 cents a share, which missed analyst expectations by 5 cents. The company had earned 41 cents in the same quarter last year. The stock lost $3.38, or 5.1%, to $63.21.

Northwest Air (NWAC Quote) remained in the red, losing $1.49 a share compared with last year's $2.08 loss. However, the loss was smaller than expected; analysts had forecast the company to lose $1.60 a share. The shares tumbled 63 cents, or 4.5%, to $13.36.

Schlumberger(SLB Quote) said Friday that it earned 50 cents a share in its fourth quarter, excluding certain items, surpassing analysts' consensus for 43 cents a share. Total sales were up about 11%. Merrill Lynch tagged the stock with an upgrade following the announcement, lifting it to buy from neutral. The shares rallied $4.27, or 7.7%, to $59.85.

And Alltel(AT Quote) reported quarterly earnings, excluding items, of 77 cents a share, matching analysts' projections, on a 4.7% increase in sales. The company's stock lost 50 cents, or 1%, to $49.31.

In research calls, Morgan Stanley upgraded Flextronics(FLEX Quote) to overweight from equal weight while also upgrading shares of Automatic Data(ADP Quote) to equal weight from underweight. Flextronics improved 30 cents, or 1.7%, to $17.80, while Automatic Data gained 26 cents, or 0.6%, to $42.22.

One day after topping earnings expectations, Pfizer (PFE Quote) was upgraded by CIBC World Markets to sector outperform from sector perform. The stock fell fractionally to $36.15.

Amgen (AMGN Quote) was downgraded by Thomas Weisel Partners to peer perform form outperform; the broker also lowered the price target to $70 from $80 a share. The company triggered a late-day slide in technology shares Thursday after it accidentally reported its earnings before the close. The shares added $2.46, or 4%, to $63.93.

Looking ahead, existing home sales will be released Monday morning and are expected to increase slightly to 6.10 million units in December from 6.06 million in the month prior.

Investors will also be awaiting the Federal Open Market Committee's first meeting of the year on Tuesday. The Fed's latest take on monetary policy will be released Wednesday at 2:15 p.m., at the conclusion of the two-day meeting.

In earnings, Tyson Foods (TSN Quote) and Schering-Plough (SGP Quote) will report before the open Monday. American Express (AXP Quote) will report during trading hours. After the close, look for results from McDonald's (MCD Quote) and Texas Instruments (TXN Quote).