The Dow and S&P 500 closed at five-year highs on Friday as the market registered a third straight week gains on a solid start to the earnings season.
General Electric led the Dow Jones industrial average higher after reporting a strong quarter thanks to growth in emerging markets.
The Dow rose 53 points to end at 13,649 Friday. The Standard & Poor's 500 index reached another five-year high, rising five points to close at 1,486. The Nasdaq gave up a point to end at 3,134, dragged down by a loss at Intel.
Capital One Financial lost 8 percent after reporting revenue and earnings that fell short of analysts' estimates.
Rising stocks outnumbered falling ones two to one on the New York Stock Exchange. Volume was in line with the recent average at 3.7 billion shares.
Shares of Intel slumped 6.7 percent to $21.17 a day after it forecast quarterly revenue below analysts' estimates and announced plans for increased capital spending amid slow demand for personal computers.
On a positive note, Morgan Stanley reported a fourth-quarter profit after a year-earlier loss, helped by higher revenue at the bank's institutional securities business. Its stock jumped 7.5 percent to $22.32.
"Intel earnings weren't that bad, although their revenue was weak. It sparks fears about not only the company but about the whole PC sector, and that's pressuring the market today," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
Heading into a three-day weekend, investors were cautious about the chances for settling of major differences in Congress about government debt and spending. U.S. markets will be closed on Monday for the Martin Luther King Jr. holiday
"Governmental policy, or lack thereof, is again pushing forth this wait-and-see attitude on the part of investors. So the market is flat and with low volume and low volatility because investors are waiting to see what happens with the debt ceiling and spending cuts," said Bryant Evans, investment adviser and portfolio manager at Cozad Asset Management, in Champaign, Illinois.
There were signs that the question of raising the U.S. debt limit would be put off for a while. House Republican leaders said they would seek to pass a three-month extension of federal borrowing authority next week to buy time for the Democratic-controlled Senate to pass a budget that shrinks deficits.
Reflecting the complacency, the CBOE Volatility index, Wall Street's so-called fear gauge, fell 7.4 percent. The VIX usually moves inversely to the S&P 500 as it is used as a hedge tool against further market decline.
Economic data from China provided some support to the market, though the focus remained on U.S. corporate earnings. The country's economy grew at a modestly faster-than-expected 7.9 percent in the fourth quarter, the latest sign the world's second-biggest economy was pulling out of a post-global financial crisis slowdown which saw it grow in 2012 at its weakest pace since 1999.