Stocks closed the week with gains of less than 1% as the Dow Jones Industrial Average broke its longest winning streak in more than four years.
The Dow ended up 0.4% for the week, the S&P 500 rose 0.6% and the Nasdaq climbed 0.8%.
Meanwhile,two Dow components, Alcoa and General Electric, reported quarterly results, kicking off the start of quarterly earnings season.
Intel was the biggest percentage gainer in the Dow on Monday after rival Advanced Micro Devices cut sales guidance and announced plans to reduce 2007 spending by about $500 million.
The Dow again closed higher on Tuesday, recording its eighth straight the longest winning streak for the blue chip index since March 2003. Alcoa, the world's largest aluminium company by sales, reported record quarterly profits on Tuesday on strong demand from China and the aerospace industry.
On Wednesday, however, the Dow ended its string of consecutive daily gains and stocks closed lower across the board. Investors were spooked by the release of minutes from the Fed's March 21 policy meeting, which reiterated the central bank's stance that inflation, not slowing economic growth, remained the predominant concern.
"I think what the market wanted to hear was that the Fed was looking to come to the rescue and add liquidity to the system, as they seemed to tip their hat to in the last FOMC announcement," said Kevin Caron, market analyst at Ryan Beck.
Investor disappointment with cost-cutting moves announced by Citigroup and a negative forecast for the real estate market also weighed down stocks.
The market bounced back on Thursday, however, as investors shrugged off a 3% gain in oil prices. Drug giants Pfizer and Merck each rose more than 1% ahead of an FDA advisory panel meeting Thursday after the bell on Merck's experimental painkiller Arcoxia, the successor to discontinued Vioxx.
Pfizer, which markets a similar drug called Celebrex, rose on Friday after the independent FDA panel voted 20-1 against recommending clearance of Arcoxia. But Merck shares rose after the company issued bullish earnings guidance, citing broad sales strength.
The revised outlook by Merck, which jumped more than 8% on Friday, fueld daily gains for the Dow, which was also bolstered by a rosy earnings forecast from McDonald's.