NEW YORK (CNN/Money) - Stocks edged higher Friday after the surprise resignations of Treasury Secretary Paul O'Neill and White House Economic Adviser Lawrence Lindsey, but the market still closed lower for the week, ending the Dow's longest winning streak in more than 4-1/2 years.

The Dow had risen for eight straight weeks, its best run since January through March 1998. The Nasdaq and S&P 500 had closed higher for the last three weeks, but all three indexes fell this week.

The Nasdaq composite (up 11.69 to 1422.44, Charts) rose 0.8 percent Friday while the Dow Jones industrial average (up 22.49 to 8645.77, Charts) and Standard & Poor's 500 index (up 5.68 to 912.23, Charts) managed small gains. But for the week, the Dow sank about 251 points, the Nasdaq composite lost 56 and the S&P 500 fell 24.

Next week brings reports on monthly retail sales, wholesale and business inventories and a preliminary reading on consumer confidence from the University of Michigan. In addition, on Tuesday, the Federal Reserve has its meeting on the economy and interest rates. But after Fed policy-makers cut rates by a half-percentage point at their last meeting, analysts expect the central bank will stand pat.

"I don't think anybody's looking at the Fed meeting because nothing's going to happen there for God knows how long," Peter Mancuso, a New York Stock Exchange Specialist at Performance Specialist Group, told CNNfn's Street Sweep. "I think next week you're looking for a continuation of what we saw today... I think you just might get the feeling that there is some good news on the horizon and that the possibility of this market doing better is very, very high."

The news of the Bush team resignations helped temper what had been expected to be a sharply negative market reaction Friday to a much-weaker-than-expected November employment report.

"It's a surprise reversal today after the labor number this morning," said Matt Ruane, head of listed trading at Gerard Klauer Mattison. "The resignation of O'Neill was certainly a positive for the market. That was clearly the catalyst. The market was also getting a little oversold. And you have some good participation from tech."

But the modest gains came on weak volume and may not affect trade next week, Ruane said, adding that with little on the earnings front and little other market-moving stimuli next week, he expects stocks to drift until the week of the 15th, when they have a chance to rally again towards the end of the year.

"For the last several weeks, the market has gotten ahead of the economic news. You're seeing that with the jobs report this morning," said John Davidson, president and CEO of PartnersRe Asset Management. "For stocks to continue to climb, you need to see the economic news start to catch up."

Investors seemed to respond positively to O'Neill and Lindsey's resignations, which both came at the request of the White House.

O'Neill and Lindsey are the second and third member of President Bush's economic team to resign of late, following Security and Exchange Commission Chairman Harvey Pitt a month ago.

"Maybe the market is looking for a stronger economic team," PartnerRe Asset Management's Davidson added. "O'Neill has not been embraced by the Street and someone with stronger ties might make them happier."

Investors may also be reacting to the idea that a change of leadership could mean the easier passage of a large fiscal stimulus package, which would help get the sluggish economy going and perhaps create more jobs.

Unemployment rose to 6.0 percent in November, the Labor Department said, surprising economists who were expecting only a modest rise to 5.8 percent from 5.7 percent the previous month. Employers also cut 40,000 jobs last month after adding a revised 6,000 jobs in October. Economists surveyed by Briefing.com expected employers to add 35,000 jobs.

In corporate news, shares of Rational Software (RATL: up $2.12 to $10.29, Research, Estimates) rallied, giving the tech-heavy Nasdaq a little lift after IBM agreed to buy the software development firm for $2.1 billion cash, or about $10.50 per share.

IBM plans to merge the company's business operations and employees into its software group as a new division.

But shares of IBM (IBM: down $0.74 to $82.32, Research, Estimates) fell on the news. Additionally, Salomon Smith Barney cut its rating on the stock to "in-line" from "outperform" on concerns about the company's valuation relative to its peers. Salomon also said that shares of sectormate Hewlett-Packard (HPQ: up $0.57 to $18.83, Research, Estimates) offer superior returns. H-P stock rallied on the news, lifting the Dow industrials.

J.P. Morgan (JPM: up $0.82 to $24.43, Research, Estimates) and aerospace components makers United Technologies (UTX: up $0.85 to $62.01, Research, Estimates) and Boeing (BA: up $0.44 to $33.40, Research, Estimates) also gave the Dow some support. Shares of the aircraft parts makers had been sharply lower Thursday in the wake of the fallout from UAL (UAL: down $0.07 to $0.93, Research, Estimates). Shares of the parent of United Airlines remained under pressure after the company was denied a $1.8 billion federal loan bailout, pushing it towards a likely bankruptcy filing.

Investors showed a surprisingly tepid reaction to Intel (INTC: down $0.25 to $18.71, Research, Estimates) after the No. 1 chipmaker issued an improved forecast as part of its mid-quarter update after the close of trade Thursday.

The company said that its fourth-quarter revenue will be in a range of $6.8 billion to $7.0 billion, an improvement on previous guidance for a range of $6.5 billion to $6.9 billion. Analysts were looking for about $6.74 billion. The company attributed the improved outlook to better sales in Asia and stronger demand for its microprocessors.

But on the downside, the company said little to reassure investors worried about the slowdown in information technology spending.

Shares of Oracle (ORCL: up $0.59 to $11.28, Research, Estimates) gained after SoundView Technologies said its research indicates that the business software maker's quarter had a solid finish and that they expect results at the upper end of Oracle's current guidance.

In international trade, European markets closed lower, while Asian-Pacific stocks ended modestly lower, with Tokyo's Nikkei index down 0.6 percent.

Treasury prices were a little higher, pushing the 10-year note yield down to 4.09 percent. The dollar weakened against the euro and the yen.

Light crude oil futures fell 36 cents to $26.93 a barrel in New York. Gold gained modestly.

Market breadth was positive. On the New York Stock Exchange, advancers beat decliners 5 to 4 as 1.23 billion shares changed hands. On the Nasdaq, winners edged losers as 1.52 billion shares traded.