Stocks have been on the fast track to multi-month highs, but some strategists say the market could be getting ready for a pit stop.

BlackRock's Robert Doll is one of those. "I don't want to sound bearish because we have made a turn, but I guess what we hear in my voice is that we could take a pause," Doll told me in an interview.

"I think we're going to have backing and filling to create more of a platform in order to go higher," said Doll.

The Dow finished the week up 1.9 percent at 12,986; the S&P 500 was up 2.7 percent to 1425.35, and the Nasdaq rose 2.4 percent to 2528. The S&P is up 12 percent from the 2008 low it made on March 10. The best performing S&P sectors were materials, up 5.6 percent, and energy, up 4.3 percent. Financials, up 1 percent, and health care, up 0.71 percent, were the laggards.

"We've come a very long way in a short period of time. We've got to be up 12, 13 percent from the bottom two months ago...I just think the world has not improved as much as the 12 percent increase suggests," said Doll.

"I'm still of the view that March 17 was a bottom, but I don't think this is a 'V' bottom and we go straight up."

Doll said he likes technology, as well as energy, health care and industrials. He said he likes higher quality, higher cap, U.S. multinationals. He says he really is cautioning that investors should not get too exuberant -- and that they consider that earnings will be challenged in the coming quarter and there are still issues with a sluggish economy and weak housing market.

Doll said he thinks the economy will grow at a very slow rate. "Not a recession, but not normal," he said. He also points out that five of 10 sectors in the S&P had double-digit growth. "The second quarter is likely to be the last of the negative earnings comparison quarters," he said.

"I think the market's runup is less about 'the economy is better and oil doesn't matter' and more about systemic risk isn't there, and therefore we can own more stocks than we did before because the world's not going to end," he said.

Week Ahead

In the week ahead, there will be some important economic news, including new inflation data in the form of producer prices Tuesday; the Fed's last meeting minutes Wednesday and existing home sales Thursday. Several Fed speakers are making the rounds. There are also a few important earnings reports from Home Depot, Lowe's and Hewlett Packard.

The rising price of oil could also be a factor. The world is also watching China, as it deals with the tragic aftermath of last week's earthquake. There is concern in commodities markets (aluminum, zinc and energy) -- not only about supply disruption from China, but new demand inside China.

What Next?

Stocks made some very important moves in the past week that are important in setting the stage for the week ahead. One of those was the S&P 500's rise above the 1420 level. To technicians, that number was key for the market to recapture.

John Roque is a technical analyst at Natexis Bleichroder. He told us in the past he'd been targeting 1420 on the S&P 500, so I called him to see what he sees now.

His new target is 1517 to 1535. "It looks like it can go higher... We try to look at other indexes for clues," he said. "The mid-cap index is through its 200-day moving average and the FTSE is through its 200 day moving average." So, why not the S&P?

Econorama

Data to watch in the week ahead include leading indicators, released at 10am ET Monday. The PPI is Tuesday at 8:30am; the FOMC minutes are Wednesday at 2pm. Oil and gasoline inventory is also released that day at 10:30am. Weekly jobless claims are Thursday as usual, and existing home sales are 10am Friday.

"I think PPI will be more important than usual this week. I think what we've learned is that a lot of the energy and all of the food cost is going to get passed on and ultimately will become part of the CPI data," said CNBC's Rick Santelli.

Oil prices hit another new high this past week -- finishing at $126.29 per barrel Friday. It set a new intraday high of $127.82 per barrel in Friday's session.

Earnings Central

There are just a few earnings reports this week. Lowe's reports Monday, as does Campbell Soup. Home Depot and Target report Tuesday morning, and Hewlett Packard reports Tuesday afternoon. Gap reports on Thursday.

Stocks were juiced ahead of Friday's session as indexes sit at the highest levels since early January.

But beware. Some traders are talking about the idea that as these highs are being reached, sluggish volume could be throwing up warning signs.

The S&P 500 finished Thursday at 1,423.57, just above the key 1,423 level that veteran trader Art Cashin had told us on Wednesday would be a very good number for stocks to reach. But after Thursday's close, he said it's too soon to tell how meaningful it will be.

"The 1,423 is a little too tight to make an all out break out call, but it certainly gives the bulls something going into (options) expirations tomorrow," said Cashin, UBS director of floor operations.

The Dow is just a breath away from 13,000, a big round number and a key psychological level. The Dow finished up 94 points at 12,992, an increase of 2.8 percent since the beginning of the year. The S&P 500 finished at 1,423.57, up 14.91 and its highest close since Jan. 3. The Nasdaq also finished at its best level since Jan. 3, rising 37 to 2,533.

Econorama

There's not a lot of economic data to latch onto Friday, though there are a few items to watch -- housing starts and building permits are at 8:30 a.m. and consumer sentiment is at 10 a.m. Treasury Secretary Hank Paulson gives an update on housing and credit markets in a speech at 12 p.m. in Washington.

Interesting for Fed watchers will be Atlanta Fed President Dennis Lockhart's appearance on "Squawk Box" as the show broadcasts from Atlanta. Fed Chairman Ben Bernanke warned Thursday that the financial markets are still fragile. He also said he was encouraged by the financial institutions ability to raise capital but he urged banks to continue raising new capital.

Stocks to Watch

After the bell, Nordstrom beat expectations for its first quarter but warned its second quarter would be a bit lighter than expected. It also talked down 2008 expectations, citing a difficult business climate. Nordstrom shares moved higher, but Kohl's stock fell after it lowered its year forecast when it reported earnings after the close.

Emerging markets shares, financials and solar stocks remain the top stocks sought by short sellers in the past week, according to Locatestock.com .

John Tabacco, chief executive of Locatestock, said the stock that short sellers have been most willing to pay a premium to locate is LDK Solar , followed by Blue Nile and Arthrocare .

"The solar names are still being hit, and while there was some covering in SPWR (SunPower ), in the last week CSIQ (Canadian Solar ) continues to be a target," he said. "I think the solars are experiencing a squeeze, but the rug could get pulled out of it if oil comes off these highs in any substantial way."

"One to watch that has been gaining momentum in price and short requests is DRYS (DryShips )," Tabacco said. The stock is in the top 10 of stocks being sought by shorts.

The top five stocks sought in the week ended Wednesday were:

• Lehman (1.88 million shares)
• General Motors (1.68 million shares)
• Canadian Solar (909,000 shares)
• iShares MSCI Emerging Markets Index (889,600 shares)
• iShares FTSE/Xinhua China 24 Index (812,000 shares)

Tabacco's firm locates stock for short sellers, who are required to have access to shares they short. That does not mean those stocks will definitely become popular shorts.

Volume at Locatestock in the past week averaged 301.2 million, a slight increase over the week earlier—and a sign that the shorts aren't giving up, Tabacco said.

See what the shorts were looking for last week by checking sought-after short stocks from last week and short stocks from the week before that .

Questions? Comments? marketinsider@cnbc.com

Wall Street's bulls are still running but they are no thundering herd heading into Thursday's market.

Thursday promises to be ruled by the economic data du jour, and the rise and fall of the price of a barrel of oil. Fed Chairman Ben Bernanke speaks at 9:30 a.m. at the Chicago Fed's conference on bank structure and competition. Bernanke's topic is risk management at banking organizations.

Econorama

There's a few important headlines to watch Thursday morning, including weekly jobless claims at 8:30 a.m.; Empire state survey at 8:30 a.m.; the Philadelphia Fed survey at 10 a.m., and industrial production at 9:15 a.m. The Treasury releases international capital data at 9 a.m.

The Dow Wednesday wilted after a triple digit rally on better-than-expected consumer inflation data. It closed 66 points higher at 12,898, while the S&P 500 moved up 5.62 to 1,408.66.

"They let the air out of the balloon a little bit. I think it was overdone ... The high-fiving on the CPI overlooks the fact it was very much about a seasonal adjustments," said Art Cashin, director of floor operations at UBS. Cashin points to the 2 percent decline in gasoline in the report, while gasoline prices actually rose.

"It was a little bit like the Emperor's new clothes. They started out with the rally, and I think there was some momentum playing here. We got very close to the 200 day moving averages ... The bulls were trying to run it, and when it didn't catch fire, it petered out," he said.

Cashin said he is looking for the S&P 500 to move above 1,422-23. "They did a double top very recently at that level. That would be the spot you want to see them punch through," he said. Cashin will be watching the Philly Fed data Thursday.

Oil Drill

Oil Wednesday was weaker, losing $1.58 or 1.3 percent to $124.22. Natural gas though rose 1.5 percent to $11.598 per million BTUs. Natural gas inventory data is released at 10:30 a.m. Thursday.

The dollar gained 0.11 percent against the euro, reaching $1.5461 per euro.

Stocks in the News

Inflation fears are beginning to trump recession worries. That was the finding of Merrill Lynch's latest monthly global fund manager survey, which shows the number of managers expecting recession this year actually declined.

In an interesting turn around, the number of managers expecting a recession fell to 29 percent from 40 percent in April's survey. But about 25 percent of the managers now see global core inflation rising in the next 12 months, compared to just 7 percent in April.

This is not surprising after the hand-wringing we've been seeing about inflation, particularly related to rising energy costs.

Stocks would have been seared today if CPI was running hotter than expected. Instead, the 0.2 percent increase was a bit lighter than expected and for now, the market bounds higher. But it wasn't the energy side that was overheating. It was food. - up 0.9 percent.

Food inflation is now running at its highest rate in 18 years. We've been watching those big run ups in grains, milk, and cheese, and it's pretty clear that rising fuel costs will continue to push those food prices higher as farmers, truckers and food companies find ways to pay the steep increase in diesel and other energy costs.

We should see more of that impact in the coming months. Deutsche Bank Chief U.S. economist Joseph LaVorgna warned us yesterday though the April CPI was not the one to be worried about. It's May and June, where we might see some real pickup in energy prices. (Check out Wednesday's Market Insider Look Ahead where LaVorgna is interviewed on energy and inflation.)

Not a Fish Tale
Sometimes it really is the picture that tells the story, and I was lucky enough to tag along with CNBC's Trish Regan when she shot a story on how food inflation is affecting restaurants. We went to the Lobster House in Cape May, NJ, one of the biggest independent restaurants in the country, and spoke to owner Keith Laudeman. (tough duty but someone had to do it)

Laudeman told us he's not raising prices yet, but that he probably will. Like many business owners, he's waiting to see where things go before passing on the increases. We also talked to the commercial fishermen on the dock at Laudeman's restaurant. They were feeling the pinch of rising diesel fuel, which has doubled since last summer. They were not though seeing the benefit of higher prices for their catches just yet.

Diesel fuel is paid out of the pocket of scallop fishermen so some crews are finding their pay checks cut back by as much as 25 percent. Some boats were using fewer crew members and running fewer trips.

These fishermen are paying the price and, in fact, showing us the other side of the inflation story. Economists have repeatedly told us that if wages do not rise along with the run up in food and energy, there's a good chance we won't see a big jump in inflation.

New data on inflation at the consumer level and oil inventory numbers are two reports that will have a hold on Wednesday's markets.

The consumer price index is released at 8:30 a.m. CPI is expected to rise 0.3 percent, or 0.2 percent excluding food and energy. Oil and gasoline inventory data is released at 10:30 a.m., and is expected to show supply of oil at about 2.3 million barrels.

Deutsche Bank chief U.S. economist Joseph LaVorgna says April CPI is not likely to be as important as May or June, which may show the increased pressure of rising energy prices.

"If tomorrow's number turns out to be weak ....people won't care," he said. "They're just going to treat it as the calm before the storm. But if you get a stronger-than-expected number, people are going to really freak out."

Lehman, in a note said it expects CPI to rise 0.2 percent. It notes that gasoline prices fell in April and that could be a factor. But we know those gasoline prices have been on the rise again, and oil is being watched very closely.

Boiling Oil

Oil again bubbled up Tuesday, gaining 1.3 percent to finish at $125.80 per barrel. According to Dow Jones, oil is now $21.65 or 20.8 percent above its inflation adjusted record high U.S. price of $104.15, set in April, 1980. Oil is up 11 percent since the beginning of May and is up 31 percent from January 1.

The stock market turned in a mixed performance Tuesday with financials giving up the most ground. The Dow slipped 44 to 12,832, while Nasdaq rose 6.63 points to 2495.12. The S&P 500 was close to flat, down 0.54 points at 1403.04. The dollar moved up 0.39 percent to a level of $1.5478 per euro. The yield on the 10-year rose to 3.909 percent as selling hit Treasurys. The two -year is yielding 2.477 percent.

Delayed Reaction

CNBC's global energy analyst Dan Yergin, chairman of Cambridge Energy Research, says we are still not seeing the real impact of $125 oil, and that it will take a while for those prices to filter down and move through the economy. "It's just beginning to unfold," he said.

Yergin says he spends a lot of time speaking with CEOs and right now energy is their top concern. "This cost factor is now front and center for CEOs, no matter what kind of company. Whether it's an energy intensive company or whether it's a company worried about whether consumers are coming into their stores."

"Energy efficiency has a priority now that I've never seen before, and CEOs and senior managers really want to discuss it in a serious way. It's affecting investment decisions and their purchasing decisions as well as their concern about what their customers are doing," he said.

Yergin says the high price of oil is gradually affecting decision making, and high prices are not now having the impact of oil shock of the 1970s. Yet, he says if prices remain high and go higher, there's likely to be an almost oozing type of oil shock.

"It may be demand shock, dollar shock. It is an oil shock . ..and anything over $110 really is a shock," he said.

LaVorgna says he thinks demand destruction will ultimately stop the rise. Yet, "people aren't going to be sure what this energy price rise does," he said. Does it kill the consumer and lead to a deeper economic downturn? "Or does it unleash inflation and cause the Fed to raise rates?" he said.

LaVorgna shared an interesting chart he created. He looked at how oil prices compared to the share of household spending on energy in the GDP.

Whether consumers are willing to open their wallets is a big theme for Tuesday's markets.
First, Wal-mart's quarterly earnings will be reported in the wee hours of Tuesday morning. The biggest U.S. retailer is expected to have earned $0.75 per share, a gain of 11 percent, on revenues of $93.2 billion, an 8 percent increase. Its forward looking comments will be very important.

Then April's retail sales are reported at 8:30 a.m. and are expected to show a decrease of 0.2 percent.

But Tony Crescenzi of Miller Tabak says there's another, fresher number investors may want to watch for signs of whether the consumer is spending. He said the International Council for Shopping Centers issues a weekly number for chain store sales that should give clues as to whether consumers are spending their stimulus checks.

Data for the week ended May 3 showed a real change in trend, with an increase of 2.3 percent, he said. Last week's number "did match the highs of the year - the week of February 26 and January 1. I think it's part of the optimism in the markets. It's certainly looking better than mid January," he said.

"It's a reasonable expectation to see it move into the 3s," he said.

Certainly some of that optimism about the consumer spilled into Monday's market. Consumer discretionary stocks were the best performing S&P sector, with a gain of 2.08 percent, followed by materials, which were up 1.88 percent.

Crescenzi said the ICSC weekly data closely tracks ISM, and if there's improving manufacturing data this week from the Philly Fed and Empire State manufacturing index, it may create more optimism. "I think it's going to make people feel better for a little while. Whether it lasts, we'll have to wait and see," he said.

There's even a chance some of the stimulus-related spending could show up in April's retail sales though the number is not expected to be good. Crescenzi said people sometimes "lend" themselves money in anticipation of a check and many may have used credit cards to make purchases ahead of receiving checks.

The boost in retail spending from the $100 million stimulus program could pump some more hope into the market. "It makes for a pretty decent story and part of the reason why we're seeing rallies back. The Vix is at a multi-month low. It's a much calmer environment," said Crescenzi.

Fed Ahead

Also big tomorrow is the speech from Fed Chairman Ben Bernanke, who speaks to Federal Reserve Bank of Atlanta financial markets conference in Sea Island, Ga.

Bernanke's topic is Federal Reserve liquidity measures and he speaks at 8:20 a.m. via satellite. Other Fed officials also are speaking at the conference.

Monday closed with word of a potential new merger between Hewlett-Packard and EDS . HP stock slumped but the idea of a big strategic merger could be a boost for other tech stocks in Tuesday's market.

On Monday, the Dow jumped 130, or 1 percent to 12,876, and the Nasdaq was up 42 or 1.8 percent, while the S&P climbed 15 or 1.1 percent to 1403.

The dollar fell 0.35 percent against the euro, after a day of up and down trading. The dollar was up 0.95 percent against the yen.

The 10-year fell, raising its yield to 3.775 percent, and the two-year also sold off, lifting its yield to 2.288 percent.

Gold slipped $0.80 to $883.70 per troy ounce.

Oil lost $1.73 per barrel, or 1.4 percent, falling to $124.23 per barrel. Gasoline fell 1.2 percent to $3.1642 per gallon on the NYMEX. But at the pump, the EIA says U.S. retail gasoline rose $0.109 to $3.722 per gallon.

Dollar Bottom?

There's been increased optimism that the dollar may be ready to bounce. I asked Boris Schlossberg about this as he visited CNBC Monday.

"The fact we are seeing everyone on the same trend, to be dollar bullish so early tells me that maybe it's not the be last gasp of the dollar bears," said Schlossberg, senior currency trader at DailyFx.com.

The move in the dollar after it hit a low of $1.6018 per euro two weeks ago has been "tepid." The more I thought about it, that price action suggests we might have another vicious runup in the euro before it's over," he said. Schlossberg noted the U.S. economy has felt the impact of credit crunch but not necessarily recession and that could come.

Questions? Comments? marketinsider@cnbc.com

Wall Street is increasingly worried that bubbling over oil prices will scald the economy and the stock market.

That's just one concern for traders in the week ahead which also has inflation data, retail sales and housing numbers. There are earnings reports from Wal-Mart , J.C. Penney and tech giant Hewlett-Packard , and the television networks hold their upfronts for advertisers.

All during the week, the Fed will be out in force, with no fewer than 14 speeches by Fed officials. That includes two from Fed Chairman Ben Bernanke himself, on Tuesday and Thursday.

President Bush is visiting the Middle East -- Israel, Egypt and Saudi Arabia. He is expected to discuss oil prices and the idea of increased production with Saudi officials.

Shades of... Pets.com?

There was a lot of chatter this past week about the potential for a "super spike" in oil prices, after a Goldman Sachs analyst said crude could go as high as $200 per barrel within the next two years.

Lehman's weekly economic note this week looked at the idea of the "super spike" and concluded that it could happen, but if oil super spikes... it will end up spiking itself.

The note also said the ramp-up in oil prices has the feeling of a bubble building. They likened it to the Internet bubble, when suddenly the rules changed and unknown Internet stocks with no earnings were flying high. (Oil was at $126 per barrel in late trading Friday -- a gain of 8.3 percent for the week and 11.9 percent in just six sessions)

Lehman says while the global economy has withstood several oil price surges in the past five years, it's different this time. First the move is much bigger -- up $60 per barrel in a year -- while the economy is much more vulnerable.

"If oil prices were to rise by another $80 on top of the $30 rise of the past several months, the result would likely be a sharp slowdown in both global growth and energy demand," Lehman economists said in their note.

Complacent? Watch Out

Stocks entered the past week feeling pretty good, but ended on a down note. Citigroup's chief market strategist Tobias Levkovich told me in an interview this week that he's seeing signs that investors are far less fearful -- and that's not entirely a good thing.

One of his models shows investors went from being panicked two months ago to more complacent -- and the change in attitude showed up like a spike in his model.

"One of the things we're getting a little nervous about is a new found complacency," he said. "..We care far more deeply about how investors position themselves around those feelings."

Levkovich says he does not think investors are fully aware of the impact of the credit crunch and the lag effect on business activity.

"We anticipate that companies are going to have to tell people over the next couple of months that business conditions have deteriorated," he said, noting industrial companies that were doing well may start to see a fall-off.

That could bring some bumps to the stock market. "There's far more risk in the industrials/commodity complex, because they're not baking in these slower conditions," he said. Levkovich said he sees the economy in a W-pattern with two legs down and then up.

"We're probably getting to that point where we're nearing the inflection point to go down the other leg of the W," he said.

"In general, we could pull back. We don't have to pull back to levels we saw March 10 but you can't rule it out either," he said. If you follow the W, stocks would then move up again after the move down.

Levkovich said a Citi survey of clients found that investors believe corporate earnings are going to be lower this year, and that their expectations were below those of Wall Street analysts.

"When numbers get cut by sell-side analysts, stocks will have trouble rallying," he said, adding that could be around mid-year.

I asked Levkovich about oil prices, and he said while Wall Street may be fixating on big round numbers of $100, $120, $150 per barrel, the real impact is the price at the pump. He said that for now, the rise has been gradual and has been largely absorbed, but an overnight spike would be different.

"I believe that the surge we see in oil prices has eaten up a huge chunk of the rebate check benefit," he said. He said it could be significant for those who were hoping the rebate check would spur a surge in spending.

One would think, though, that the earnings power of companies and consumers is going to start taking a hit if the trend continues.

Just Friday, FedEx warned again that it was feeling the impact of rising fuel costs. It cut its quarterly earnings forecast from $1.60 to $1.80 to $1.45 to $1.50 per share. It said since it made its fourth-quarter forecast in March, it has seen a $100 million or 7 percent increase in fuel costs. FedEx says it has a dynamic fuel surcharge in place, but it cant keep up with rapidly rising fuel costs. Imagine a super-spike.

The Dow this past week was down 2.4 percent to 12,745, its worst performance since March 7. The S&P 500 pulled back 25 points or 1.8 percent for the week to 1388, and the Nasdaq was off 1.3 percent to 2445. Financials were the worst performers, down more than 6 percent, and the best performer was energy, up 2.9 percent.

The dollar lost 0.4 percent against the euro, ending three weeks of gains. It was at $1.5483 Friday, and the 10-year Treasury yield was at 3.765 percent.

Earnings Central

Earnings this week are expected from Sprint Nextel on Monday; Wal-Mart and Electronic Arts on Tuesday; Deere , Freddie Mac , Macy's and Sony on Wednesday, and Hewlett-Packard, J.C. Penney and Kohl's on Thursday.

Econorama

The coming week's data includes some important numbers: retail sales on Tuesday; CPI on Wednesday and housing starts and pending home sales Friday.

Other data includes Tuesday's NFIB small business survey at 7:30am ET. Import and export prices are also released that day, as are business inventories. On Thursday, weekly jobless claims are reported at 8:30am; the Empire State survey, the Philadelphia Fed survey, and industrial production are also released that morning. Treasury also releases data on international capital flows that day. The National Association of Home Builders survey is released Thursday afternoon. Consumer sentiment is reported at 10am ET Friday.

Fed on Parade

Every time you turn around next week, a Fed official will be beginning or ending a speech. Okay, an exaggeration -- but there are 14, and I probably omitted a few.

There are two big conferences Fed officials will be attending. One is the Atlanta Fed's financial markets conference in Sea Island, Ga., where Bernanke will speak Tuesday at 8:20am. The other is the Chicago Fed's annual conference on bank structure and competition, where Bernanke speaks Thursday at 9:30am on risk management at banking organizations.

Before and after those two speeches, we'll hear from a number of other Fed officials. On Monday, Cleveland Fed President Sandra Pianalto speaks in Paris at 4:15am (New York time) and Chicago Fed President Charles Evans speaks on the outlook at 9:15.

On Tuesday, Pianalto again speaks in Paris; Bernanke speaks in Georgia and Fed Governor Kevin Warsh moderates a panel at the Fed conference in Sea Island, Ga. Philadelphia Fed President Charles Plosser moderates a panel in Georgia at 11am.; San Francisco Fed President Janet Yellen speaks on the economy in Vancouver at 1pm; Kansas City Fed President Thomas Hoening speaks on he outlook in Oklahoma at 1pm, and Evans speaks at 8pm in Chicago.

Wednesday's speeches include Boston Fed President Eric Rosengren at a Boston Fed conference at 8:30am. Fed Governor Randall Kroszner speaks on risk management and Basel II in Boston, and Yellen speaks in Tacoma, Washington at 4:40 p.m. on an introduction to the FOMC.

On Thursday, Evans speaks at the Chicago Fed conference at 9:15am ET, then Bernanke speaks at 9:30 and Fed Governor Frederic Mishkin speaks on asset price bubbles in n Philadelphia at 7pm.

Questions? Comments? marketinsider@cnbc.com

With increasing anxiety, the stock market is looking over its shoulder at the energy markets. Oil briefly topped $126 per barrel today, and as oil trades above $125, we wonder how much these high prices will spread out to affect the consumer, corporate profits, corporate spending and government spending.

Commodities and energy are likely to stay in the driver's seat Friday. Those were the power groups, and the financials were the weaklings again in Thursday's stock market.

Insurer AIG's bad earnings news may keep that trend going. AIG stock fell in the after hours Thursday after it said it lost $7.81 billion for the first quarter, on billions in charges and investment losses. The insurer also said it plans to raise $12.5 billion in new capital. Funny how its stock had been falling in the past two sessions ahead of that earnings (or loss) report.

Another financial stock in the news Friday will be Citigroup which hosts an investor day. Citigroup CEO Vikram Pandit is expected to detail his vision for Citi and its future as a financial services supermarket.

In Thursday's market, the dollar mostly wobbled as oil continued to bubble higher, setting a new high above $124. Gold rose 1 percent, rice surged and corn hit a new high. The Dow rose 52 points to 12,866; Nasdaq was up 12 and S&P 500 rose 5.

Of the S&P sectors, materials was the best performer, up 2.3, followed by energy, up 1.9 percent. For the week, materials is again a leader, up 3.5 percent and energy stocks are up 3.7 percent. Financials were lower, off 1.2 percent Thursday and down a big 5.4 percent for the week so far.

In economic news Friday, traders are watching the international trade data for March, due at 8:30 a.m.

Red Hot Commodities

Oil's more than 10 percent gusher in recent sessions is taking its toll on investors' psyches, if not stock prices.

"I think high oil prices are at a point where they are close to a tipping point, and they sow the seeds of their own destruction," said Morgan Stanley's David Darst who was at CNBC Thursday for his appearance on "Closing Bell." He said it would be senseless to try to pin point the top, but he says the high prices are at a level where they can cause significant economic impact, and ultimately oil will back down.

Darst, chief investment strategist, Global Wealth Management, said the current momentum trend means investors have to play defense and offense at the same time. He pointed out that the transports, typically hurt by energy, have risen 16 percent since the beginning of the year. He said a decline in energy would help those same stocks.

Darst says he follows the Baltic Dry Freight Index, a kind of mirror for commodities and transportation. The index measures shipping rates for raw materials, excluding energy. The index peaked at 10,000 before declining to 7,500 just before the Bear Stearns rescue. "I've been staggered by how it's recovered to 10,200," he said.

The rise in the index parallels the rising pressure on oil and other commodities and is driven by momentum. "It's like a super tanker," he said. It takes a while to turn around, but the slowdown of the U.S. consumer may ultimately be the brakes, he said.

Questions? Comments? marketinsider@cnbc.com