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Stocks Wobble as Earnings Worries Nag

Stocks got a quick pop Friday from a rebound in consumer sentiment to its highest level since September.

But the bounce quickly slowed to a dribble as earnings worries nagged. Investors focused on a warning from Google instead of better-than-expected results from General Electric and Citigroup. This came after a rally Wednesdaythat pushed the Dow up more than 1 percent and the Nasdaq up nearly 3 percent.

General Electric shares slipped after the conglomerate beat its earnings target, with a profit of 26 cents a share, but narrowly missed revenue expectations, reporting revenue dropped 9 percent to $38.4 billion. GE is the parent of CNBC.

An early rally in Citigroup shares fizzled after the bank posted a loss of 18 cents a share, nearly half the 34 cent-loss expected.

Bank of America also lost momentum as investors worry about its earnings, which are due out on Monday. After taking a beating recently, Bank of America shares quietly eclipsed $10 this week.

Also in Dow country, General Motors CEO Fritz Henderson is scheduled to update the media on the automaker's restructuring later on Friday in the first series of updates designed to provide perspective on the company's situation.

After the closing bell on Thursday, Googletopped earnings forecasts but its warning that the economic environment remains tough sent a ripple of selling through tech following a stellar performance on Wednesday.

"We're still basically in uncharted territory,'' Google CEO Eric Schmidt said on a conference call. "Google is absolutely feeling the impact. Users are still searching but they're buying less. Ultimately, what that really means is the ads are converting less," he said.

Dryships surged more than 10 percent a day after the carrier company said it raised $500 million in capital.

There were mixed signals from US policymakers overnight, with the head of the Atlanta Fed, Dennis Lockhart, predicting a return to growth later this year, while the head of the San Francisco Fed, Janet Yellen, said she saw the potential for a deeper contraction, Reuters reported.

Preliminary April consumer sentiment data due later on Friday, could throw light on to whether the rate of contraction in the US economy is easing.

The University of Michigan will release its preliminary April consumer sentiment index at 9:55 am New York time. Economists in a Reuters poll expect a reading of 58.5 compared with 57.3 in the final March report.

Federal Reserve Chairman Ben Bernanke speaks in Washington at 12:30 pm New York time on innovative financial services for the underserved. And Kansas City Fed President Thomas Hoenig will also be talking in the capital at 8.30 am.

Meanwhile, the Obama administration will meet with top credit card executives next Thursday to discuss transparency in the companies' lending practices and interest rates, Reuters reported.

Late Thursday, Starwood Hotels & Resorts Worldwide sued rival Hilton Hotels and two of its top executives for corporate espionage, Reuters reported.