Techs, Banks Rally, Capping a Dismal Week

Stocks ended a topsy-turvy week mixed as techs and banks rallied but about half of the Dow finished the day in negative territory.

The Dow Jones Industrial Averageshed 45.24, or 0.6 percent, to close at 8,077.56. The S&P 500gained 0.5 percentand theNasdaq advanced about 0.8 percent.

After the worst inauguration day sell-off in history on Tuesday, the Dow rallied back on Wednesday, then spiraled lower for the rest of the week amid worries about earnings, dismal outlooks and more fallout from banks.

That left major indexes sharply lower for the week: The Dow lost 2.5 percent, while the S&P dropped 2.1 percent and the Nasdaq fell 3.4 percent.

Google shares rose 6 percent Friday after the Internet giant beat earnings expectations as advertising remained robust despite the economic slowdown.

That came after IBM's earnings blew past forecastsearlier in the week and Big Blue projected that earnings would rise more than expected in 2009.

Techs have been beaten down lately and some pros say that's the place to look right now.

"If you didn’t nibble at the basic materials and the oils and some of the really, really good cyclicals back in November, ... you missed your dirt-cheap opportunity," said Michael Cohn, , chief investment strategist at Atlantis Asset Management. "Tech is the place to look," he said. "The IBM news was actually incredible."

But it wasn't all fun and electronic games in tech land.

Samsung Electronics posted its first-ever quarterly loss, joining the ranks of Microsoft, Nokia and Sony , that have disappointed investors with results.

And, pros say brace for dismal results from wireleess-chip makers next week, including Texas Instruments , Qualcomm and Broadcom , after top mobile-phone makers posted abysmal sales and weak forecasts.

General Electric was the biggest decliner on the Dow — for today and the entire week — after the conglomerate met earnings expectations but concerns about its dividend and triple-A rating lingered in the market. GE is the parent of CNBC.

Caterpillar , which reports earnings next week, and United Technologies , which earlier this week warned that the first half would be particularly brutal, rounded out the Dow's bottom three.

Next week will bring a slew of Dow earnings as 11 Dow companies report, including Caterpillar, McDonald's and American Express on Monday.

>> Track how all 30 Dow components performed today.

American Express shares slipped after Citigroup slapped the credit-card maker with a "sell" rating, citing the slowdown in consumer spending.

Fox-Pitt, Kelton noted that Capital One's terrible fourth quarter indicated things got worse for credit-card companies in December and that AmEx in particular might have to cut its dividend or raise more capital.

Capital One shares tumbled more than 10 percent after three analysts cut their price target on the stock. S&P cut its credit outlook on the company to negative and said a further downgrade is likely. On Thursday, Capital One missed earnings expectations and forecast more credit losses in 2009 as credit-card spending fell 10 percent.

"Deteriorating credit [at Capital One] may erode all profits over the next 12-18 months," Richard Shane, an analyst at Jefferies, wrote in a research note to clients. "The uncertainty surrounding the depth and duration of the labor downturn will continue to weigh on the shares."

Citigroup also put a "sell" rating on MasterCard but put Visa on its "buy" list.

Harley-Davidson shares skidded 7.3 percent after the motorcycle maker said it would lay off 1,100 workers and close plants as a global consumer slowdown battered its business and sent earnings below Wall Street estimates.

Bank of America shares rallied 9.3 percent, but were still lost 13 percent for the week, making it the Dow's second worst performer this week.

A growing chorus began to call for CEO Ken Lewis's resignation, after Merrill CEO John Thain agreed to resign from the joint company.

>> Poll: Should Ken Lewis get the boot, too? Vote now.

Citigroup shares rebounded 12 percent Friday, though remained at about $3.50 a share, while JPMorgan Chase gained 5.1 percent.

Wyeth shares jumped 13 percent as drug giant Pfizercould be set to buy the company, the Wall Street Journal reported. Pfizer shares rose 1.4 percent.

Elsewhere, Xerox shares lost 7.4 percent after the office-equipment maker's earnings of 30 cents a share missed expectations.