Stocks Finish Week Higher

Stocks rose modestly on Friday, finishing the week higher and keeping the September rally on track. Gregg Greenberg has The Real Story.
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NEW YORK (

TheStreet

) -- Stocks rose modestly on Friday, finishing the week higher and keeping the September rally on track.

The

Dow Jones Industrial Average

finished higher by 12 points or 0.1% at 10,607. The

S&P 500

was flat at 1,125. The

Nasdaq

had a stronger finish, ending up 12 points, or 0.5%, to 2,315, driven by better-than-expected earnings from

Oracle

(ORCL) - Get Report

and

Research In Motion

(RIMM)

.

The Dow finished the week up almost 1.4%. The blue-chip index crossed into positive territory for 2010 late last week, and is now 1.7% higher for the year. In September alone it's risen 5.9%, posting gains in seven of the last eight sessions.

Caterpillar

(CAT) - Get Report

,

DuPont

(DD) - Get Report

and

United Technologies

were the major Dow gainers, up 1.5%, 1.4% and 1.4% respectively, while

Hewlett Packard

(HPQ) - Get Report

and

JPMorgan Chase

(JPM) - Get Report

were the biggest losers, down 3% and 2% respectively.

Market sentiment was mixed through Friday's trading. For every three stocks that gained, two stocks declined. But the Dow finished the week higher by 1% and the S&P 500 briefly flirted with the critical 1130 resistance on Friday.

Financial stocks were weak after the

Securities and Exchange Commission voted to propose new rules that would require banks to disclose more information about their short-term borrowing.

Bank of America

(BAC) - Get Report

was shedding 1% to $13.40,

Wells Fargo

(WFC) - Get Report

was sliding 0.3% to $35.06.

Consumer stocks were also losers on Friday after the University of Michigan preliminary index of consumer sentiment fell to 66.6 in September from a reading of 68.9 the previous month. The index was expected to climb to 70.5, according to estimates from Briefing.com.

Prices at the consumer level ticked 0.3% higher in August, after a similar rise in July, the Labor Department said. Excluding volatile food and energy prices, the core rate was unchanged, coming in slightly lower than the increase of 0.1% that economists had been expecting, according to Briefing.com. In July, the core rate rose 0.1%.

Linda Bakhshian of Federated Investors said that inflation was not a concern in the current economic backdrop with unemployment still high. "Consumers are still strained. Wage growth is tame. Companies are unable to pass on price hikes," she told

TheStreet

on Thursday, ahead of the CPI report.

Stocks have been rallying in September as better-than-expected economic data abated concerns of a double-dip recession. However, investor enthusiasm is waning as the economic recovery appears long and drawn out. Yu-Dee Chang, chief principal at ACE Investment Strategy, said investors will have to be patient and ride out the weakness. "The average recession is 10 months. This recession is now a little over two years. We cannot rush to see a nice recovery. The damage is just too much this time," Chang said.

In corporate news,

Johnson & Johnson

(JNJ) - Get Report

, which owns nearly 18% of Dutch biotech company

Crucell

(CRXL)

, is in advanced talks to acquire the rest of Crucell for roughly $2.3 billion in cash. The stock of Johnson & Johnson ended 0.5% lower at $61.18. Shares of Crucell were soared 56% to $32.02.

Citigroup

(C) - Get Report

ended flat at $3.95 after it agreed to sell

Student Loan Corp.

(STU)

, its indirect private student loan subsidiary to

Discover Financial Services

(DFS) - Get Report

for $600 million. Shares of Student Loan skyrocked 41% to $29.86. The stock of Discover shed 1.4% to $15.57. Shares of

Sallie Mae

(SLM) - Get Report

rose 4.5% to $11.72.

Enterprise software company

Novell

(NOVL)

is reportedly in late-stage talks with at least two buyers -- including

VMware

(VMW) - Get Report

-- to sell the company in separate pieces, according to a

Wall Street Journal

report. The stock rose 1.1% to $6.12.

Late Thursday,

Texas Instruments

(TXN) - Get Report

announced plans to increase its quarterly dividend by 8% and buy back $7.5 billion worth of its stock. The stock gained 3% to $25.73.

Caterpillar

(CAT) - Get Report

reported strong

retail sales in August, with the North American region seeing the steepest uptick since the recession began rising 40%. Shares ended 1.5% higher at $73.11.

Blockbuster

(BLOKA.PK)

was in focus on reports that

activist investor Carl Icahn is looking at having a bigger say in the company's restructuring as he holds over a third of its debt.

Massey Energy

(MEE)

plunged 7% to $29.95 after it lowered its 2010 outlook, citing idle mines and stringent mining regulations. For full-year 2010, the energy company expects to ship about 39 million tons of coal, the low point of its earlier anticipated shipment range of 39 to 40.5 tons.

Total

(TOT) - Get Report

tumbled 2.5% to $49.33 after Collins Stewart downgraded the stock from a buy to a hold, citing currency headwinds.

Shares of

United Airlines

(UAUA)

and

Continental

(CAL) - Get Report

approved a merger of the two carriers on Friday . The new United will be the world's largest airline. Shares of United Airlines slid 1.2% to close at $22.11 and shares of Continental Airlines skid 1.2% to $23.03 respectively.

In commodity markets, crude oil for October delivery settled 91 cents lower at $73.66 a barrel, and the more actively traded November contract settled 82 cents lower at $74.92 a barrel. Meanwhile, the December gold contract settled higher by $3, trading at $1,275.9 an ounce.

Meanwhile, the dollar was trading slightly higher against a basket of currencies, with the dollar index up by 0.2%.

The benchmark 10-year Treasury note was up by 5/32, diluting the yield to 2.746%, following low inflation numbers and declining consumer confidence.

Overseas, Hong Kong's Hang Seng rose 1.3%, while Japan's Nikkei jumped 1.2%. The FTSE in London ended 0.4% lower while the DAX in Frankfurt closed down by 0.6%.

--Written by Melinda Peer and Shanthi Venkataraman in New York

.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.