STOCKS SHARPLY HIGHER IN APRIL

Click the chart for more market data. By Ken Sweet, contributing writerApril 29, 2011: 4:20 PM ET

NEW YORK (CNNMoney) — U.S. stocks posted modest gains Friday, as strong earnings from Caterpillar lifted the blue chips but tech shares remained under pressure following a lowered outlook from BlackBerry maker Research in Motion.

“The market feels a little on the high side, but these good earnings figures keep stocks slowly moving higher,” said Frank Davis, director of sales and trading at LEK Securities.

The Dow Jones industrial average (INDU) rose 47 points, 0.4%, to close at 12,811.

Shares of Caterpillar (CAT, Fortune 500) helped life the Dow, after the company said its bottom line got a boost from strong demand for bulldozers and other heavy machinery. Shares closed up 2.5%.

The S&P 500 (SPX) was up 3 points, or 0.2%, to 1,264; and the Nasdaq Composite (COMP) rose 1 point, or less than 0.1%, to 2,874.

The tech-heavy Nasdaq mostly weighed down by shares of Research in Motion (RIMM), which plummeted 14% after the BlackBerry maker warned of weaker sales.

Investors remain nervous about the economy and inflation. The Fed has been pretty clear that interest rates aren’t likely to budge this year. Meanwhile, gold and silver continue to hit new highs as the U.S. dollar keeps sliding, falling to a three-year low against the euro.

On Thursday, U.S. stocks rose to multi-year highs, as investors looked beyond a series of mixed earnings reports and disappointing GDP and jobless claims reports.

Companies: Dow components Chevron (CVX, Fortune 500) and Merck (MRK, Fortune 500) reported better-than-expected earnings before the opening bell.

Merck’s quarterly profit tripled on strong drug sales, while Chevron reported a 26% jump in quarterly net income, driven by higher energy prices. Shares of both companies were up 0.6%

Late Thursday, Microsoft reported a 31% surge in quarterly profit, on strong Office and Kinect sales. But not all the news was good, as netbook sales fell 40%. Microsoft’s (MSFT, Fortune 500) stock slipped 4% – its worst daily performance since 2009.

Goodyear Tire shares jumped 12% after the company reported better than expected results, mostly because the company was able to raise prices.

Economy: The Commerce Department said Friday that U.S. personal spending rose 0.6% in March, slightly better than the 0.5% expected by economists. Personal incomes rose 0.5% compared with economists’ forecast of a rise of 0.4%.

Currencies and commodities: The dollar fell against the euro, the Japanese yen and the British pound.

Oil for June delivery closed up 84 cents at $113.71 a barrel.

Gold futures for June delivery settled at a new record high of $1,569.80 an ounce.

Gold prices are benefiting from weakness in the dollar, said David Wyss, chief economist for Standard & Poor’s.

“You have to put your money somewhere,” he said. “Right now people are afraid because of low interest rates and unsustainable budget deficits.”

Bonds: The price on the benchmark 10-year U.S. Treasury slipped, pushing up the yield slightly to 3.32%.

World markets: On Friday, the London Stock Exchange was closed for the royal wedding.

European markets closed mixed. The DAX in Germany added 0.4% and France’s CAC 40 closed mostly unchanged, down less than 0.1%.

Asian markets ended the session mixed. The Shanghai Composite rose 0.8%, while the Hang Seng in Hong Kong slipped 0.4%. Japan’s Nikkei was closed for holiday. 

First Published: April 29, 2011: 9:56 AM ET