Dow sets record for 4th straight day

NEW YORK (CNNMoney.com) -- The Dow Jones industrial average rose to a record high for the fourth straight session Friday, while the S&P 500 finished above 1,400 for the first time in more than six years.

The Dow (up 36.74 to 12,342.56, Charts) rose 0.3 percent to close at a new record - the 18th new high since Oct. 3.

Special Reportfull coverage America's cheapest gas is in this town Summer drivers to get a break on gas Why gas prices are likely to keep climbing You'll pay a little less for gas this summer Expect relief from record February gas prices Why gas prices are rising

The broader S&P 500 (up 1.44 to 1,401.20, Charts) index added 0.1 percent, marking its highest level since Nov. 8, 2000.

The tech-fueled Nasdaq composite (down 3.20 to 2,445.86, Charts) lost about 0.1 percent but was off its lows after ending the previous session at its highest point since February 2001.

Earlier in the session, stocks fell after a big drop in housing unnerved investors. But buyers returned in early afternoon as the consumer sector got a boost from Altria and falling oil prices.

Housing starts slumped 14.6 percent in October to a 6-1/2 year low, the government reported Friday, while building permits fell to the lowest pace in 9 years.

"Yes the news on housing continues to be dismal, but it's being, to some extent, offset by the decline in energy prices," said Hugh Johnson, chairman of asset management company Johnson Illington Advisors.

Light, sweet crude oil for December delivery fell 45 cents to $55.81 a barrel on the New York Mercantile Exchange, after hitting a 17-month trading low of $55.08 earlier in the session.

Treasury bond prices rallied on the housing report, lowering the yield on the benchmark 10-year note to 4.60 percent from 4.66 percent late Thursday. Bond prices and yields move in opposite directions.

In recent days, the economic news has suggested that the Federal Reserve is unlikely to cut rates soon, after mild reads on inflation and strong regional manufacturing reports.

While bets that the Fed could start cutting rates next year should ultimately prove supportive to the market, after the recent rally, stocks were vulnerable Friday.

For the week, the Dow rose 2 percent, the Nasdaq added 2.4 percent and the S&P was up 1.5 percent.

Trading should be lighter next week as the Thanksgiving holiday approaches. Markets will be closed Thursday and shut early on Friday.

In corporate news, Altria (up $1.44 to $85.01, Charts) benefited from a U.S. Appeals Court decision to grant a permanent stay in the class action suit against light cigarettes. The stock rose close to 2 percent, making it one of the Dow's top gainers.

Fellow Dow component Hewlett-Packard (down $0.36 to $39.77, Charts) reported higher earnings and revenue late Thursday, topping forecasts, and offered a bullish outlook for the current period. But investors seemed to take a 'sell the news' perspective and shares lost 1 percent in afternoon trading. (Full story).

Of the 30 stocks in the Dow, 17 rose and 13 fell.

Starbucks (down $2.01 to $37.42, Charts) fell 5 percent after the specialty coffee retailer reported lower profit late Thursday and issued a sales and earnings forecast in a range that could miss analysts' expectations.

A variety of technology shares slipped, with the chip sector hit the hardest. The Philadelphia Semiconductor (down 2.68 to 483.25, Charts) index, or the SOX, fell more than 0.5 percent.

Intel (Charts) took a hit as sector-mate Marvell Technology Group (down $0.57 to $19.05, Charts) was downgraded by a Prudential analyst who expressed concern with the company's margins.

In merger news, Johnson & Johnson (up $0.62 to $67.15, Charts) said it will buy heart device maker Conor Medsystems for around $1.4 billion in cash. Shares of JNJ gained 1 percent, while Conor (up $5.16 to $32.68, Charts) rallied 19 percent.

NYMEX Holdings (Charts) surged on its first day of trading Friday, a day after the energy exchange's shares priced above a forecasted range.

Market breadth was negative. On the New York Stock Exchange, decliners edged out advancers on volume of about 1.7 billion shares. On the Nasdaq, losers topped winners by about three to two on volume of 1.8 billion shares.

COMEX gold rose 80 cents to settle at $622.50 an ounce.

In currency trading, the dollar weakened versus the yen and the euro.

Democratic Congress: winners and losers

More on investing

More on the markets