Stocks pared losses in the last minutes of Friday's session after trading lower much of the day as stronger-than-expected U.S. job gains in October failed to continue a rally that led stocks to two-year highs on Thursday.
The Dow Jones Industrial Average was down more than 20 points a day after all the major indexes reached two year highs.
Kraft and Merck led the blue-chip index lower, while JPMorgan and Alcoa rose.
The S&P 500 Index rose slightly and the Nasdaq slipped. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to just above 18.
Financials led the key S&P 500 gainers while telecom and health care sectors declined.
Despite Friday's lackluster session, the markets were on pace to post strong results for the week: the Dow was up more than 2.5 percent, the Nasdaq was up more than 2.4 percent, and the S&P 500 was up more than 3 percent for the week.
The jobs number gave a boost to the dollar, as investors viewed the news as a surprising sign of real strength in the economy.
But the dollar's rise wasn't good news for stocks, which have been moving moving inversely to the U.S. currency. When the value of the dollar is low, interest rates are low, and dollar-denominated assets are cheaper to foreign buyers, a scenario that has pleased the markets.
Traders also were assessing how to judge the Fed's plans to pump more money in the economy now that jobs are coming back.
In a surprise, gold continued to rise, settling at new high for the yearof $1,397.30. Some market participants see the dollar's move higher as temporary, and remain uncertain as to the economy's true strength. And among other metals, silver hit a 30-year high to catch up with gold prices, while palladium rose to a fresh nine-year high.
Meanwhile, oil prices fell below $87 a barrel, slipping from a two-year high.
Financials outperformed other sectors amid speculation that the Fed will soon allow some healthy banks to increase dividend payments, people familiar with the decision said late Thursday.
Shares of Bank of America and Wells Fargo were up more than 4 percent. Citigroup and JPMorgan climbed more than 3 percent. The Keefe Bruyette Woods Bank Index rose more than 2 percent.
News that global shipments of personal computers continued to rise in third quarter failed to lift many computer makers on Friday. The market research firm iSuppli said shipments rose from the second quarter as well as from a year ago to 88.1 million units.
Nonetheless, Apple , IBM , HP and Dell were all lower.
Meanwhile, shares of Research in Motion fell more than 3 percent after news Dell plans to switch its 25,000 BlackBerry users to Dell's smartphone, the Venue Pro.
Shares of Massey Energy soared after news the coal producer received a takeover offer from Alpha Natural Resources, according to the Wall Street Journal.
More companies continued to reportearnings with mixed results. AIG shares slipped after the insurer reported losing more than $2 billion because of charges and losses from asset sales. AIG also reported it expects to close its recapitalization plan to reduce the government's stake in the company to just about 92 percent.
Toyotaraised its full-year outlookfor the second time after Japan's subsidies to stimulate demand helped almost double quarterly earnings.
Coventry Health advanced after the health insurer posted earnings that were much better than anticipated, as medical costs fell. The firm also raised its outlook, and said profits would rise 67 percent this year.
However, health care stocks were in the red across the board, including UnitedHealth and Cigna.
Pharmaceutical companies were lower as well after news that even a Republican sweep of the House is unlikely to stop health care legislation from being enacted. Pfizer and Novo Nordisk were lower.
Beazer Homes rose even after the homebuilder reported a surprising drop in third quarter earnings as the sluggish economy continued to drag down homes sales.
Kraft slumped a day after the Dow component reported a weak revenuefor the quarter.