Stocks continued to trade higher Friday despite a hike in bank reserve requirements by China's central bank, and in the absence of major economic news or earnings.
The Dow Jones Industrial Average rose more than 40 points after fluctuating at the open. The blue-chip index hit a new multi-year high on Thursday, reaching its highest level since June 5, 2008.
Among Dow components, Cisco , Travelers and Caterpillar rose, while Pfizer and American Express fell.
The S&P 500 and the Nasdaq traded slightly higher after both reached new multi-year highs again as well on Thursday. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to about 16.25.
Among key S&P 500 sectors, energy, healthcare and industrials gained, while materials and telecom fell.
Rival stock exchanges were continuing to mull whether to launch a competiting bid for the New York Stock Exchange, just days after NYSE Euronext and Deutsche Boerse announced plans to merge, CNBC reported on Friday. The potential bidders include Nasdaq, the Intercontinental Exchange , and the CME .
In China, the People's Bank of China raised lenders' required reserves by 50 basis points, on Friday, the second such increase this year as it tries to curb inflation.
The move came as PBOC governor Zhou Xiaochuan joined G20 ministers and central bankers to discuss a reform of the currency system—with less reliance on the US dollar—and commodity prices. Host France would like to tackle speculation to limit volatility on the markets.
The G20 has set itself the ambitious goal of agreeing on how to measure imbalances in the global economy, but a final agreement is not expected when the two-day meeting concludes on Saturday. Inflation is unlikely to be on the agenda. In remarks ahead of the summit on Friday, Federal Reserve Chairman Ben Bernanke acknowledged the Fed's bond buying program to stimulate the U.S. economy may be contributing to accelerated growth in emerging markets, but he said rigid exchange rate policies share the blame.
Bernanke will join a panel of central bankers at the gathering on Friday, including European Central Bank President Jean-Claude Trichet, the Bank of England's Mervyn King and the PBOC's Zhou Xiaochuan.
Investors will continue to closely monitor political unrest in the Middle East on Friday as crowds in Libya, Yemen, Iran and Bahrain took to the streets.
Oil prices gained, with U.S. light sweet crude rising above $87 a barrel amid the tensions in the Middle East. London Brent crude was up slightly, just under $103 a barrel.