NEW YORK  (CNNMoney) -- U.S. stocks opened higher Tuesday, with all three indexes up about 1%, following better-than-expected retail sales and manufacturing data.

The Dow Jones industrial average (INDU) added 95 points, or 0.8%, the S& P 500 (SPX) rose 12 points, or 1%, and the Nasdaq composite (COMP) gained 27 points, or 1%.

The first round of economic data this week helped set the stage for an early rally.

The Commerce Department said retail sales slid 0.2% in May. While it was the first decline in 11 months, it was much less of a decline than economists had expected.

Additionally, the Labor Department issued a brighter report on the producer price index, also known as manufacturer inflation. The PPI rose 0.2% in May, slightly better than the 0.1% that economists had forecast.

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U.S. stocks were also higher on the heels of positive data out of China. The country released a report on industrial production that beat expectations and said inflation picked up in May -- easing worries about a sharp economic slowdown.

" We've had six straight weeks of down for stocks, so any type of positive news is going to help," said Anthony Conroy, head trader at BNY ConvergEx Group. " Right now we're getting a little bit of a bounce from the pretty good news out of China."

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On Monday, stocks began the session higher following a series of corporate deals. But the gains were short lived after credit agency Standard & Poor's downgraded its rating on Greece to " CCC." S& P also kept its negative outlook on Greece. The major indexes ended little changed.

Companies: Smartphone makers Apple (AAPL, Fortune 500) and Nokia (NOK) agreed to settle their long-running patent dispute early Tuesday. Apple will pay Nokia a one-time sum, and ongoing royalties will go to Nokia. Shares of Nokia jumped 4% in morning trading, while shares of Apple edged up less than 1%.

Meanwhile, Honda (HMC) released its full-year forecast Tuesday, announcing that it expects a 63.5% drop in 2011 profit. Shares of Honda slid 0.2%.

Shares of Best Buy (BBY, Fortune 500) climbed more than 8%, after the consumer electronics retailer reported first-quarter results that beat expectations.

World markets: European stocks were higher in afternoon trading. Britain's FTSE 100 rose 0.3%, the DAX in Germany jumped 1.5% and France's CAC 40 added 0.8%.

Asian markets ended the session mixed. The Shanghai Composite climbed 1.1% and Japan's Nikkei rose 1.1%, while the Hang Seng in Hong Kong ended barely below breakeven.

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China released inflation data that showed the nation's rapid pace of inflation picked up again in May -- even though the government has stepped up efforts to tame rising prices.

The country's inflation rate rose slightly to 5.5% in May, up from an increase of 5.3% in April, according to China's National Bureau of Statistics.

After the announcement, China's central bank raised the reserve requirement ratio for depository financial institutions by half a percentage point, effective June 20.

While inflation remains high, Conroy said the report eased fears of stalling growth.

" It's either inflation or a slowdown -- there's always something to worry about," he said. " But I think you would rather worry about inflation than things really falling off a cliff."

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

Oil for July delivery gained 6 cents to $97.36 a barrel.

Gold futures for August delivery rose 50 cents to $1,1516.10 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury slipped, pushing the yield up to 3.01% from 2.99% late Monday.   

At the close, the Dow Jones industrial average (INDU) rose 1 point, or less than 0.1%, to end at 11,953 the S& P 500 (SPX) added less than a point to close at 1,272 and the Nasdaq Composite (COMP) fell 4 points, or 0.2%, to 2,640.

Stocks opened higher following a series of deals. But the gains were short lived after credit agency Standard & Poor's downgraded its rating on Greece to " CCC." S& P also kept its negative outlook on Greece.

The downgrade pressured the currency and commodity markets. Oil fell 2% to $97.30 a barrel. Silver prices slid more than 4%. And and gold dropped 1% to $1,515.60 an ounce.

Energy and material stocks were hit hard, with Cabot Oil (COG) tumbling 3.5% and Halliburton (HAL, Fortune 500) shares down more than 2%.

S& P downgrades Greece

" A couple months ago, the market would have overlooked a Greece downgrade," said David Levy, portfolio manager with Kenjol Capital Management. " But with this negative market sentiment, it's another reason to sell."

Stocks have taken a drubbing as of late, with concerns about the economy leaving investors battered and bruised.

With no economic data on tap for Monday's session, U.S. investors focused on a series of corporate deals announced before the opening bell.

Apparel company VF Corp. (VFC, Fortune 500), the maker of Wrangler and The North Face brands, agreed to buy Timberland for $43 per share -- creating a $10 billion apparel and footwear company. Shares of Timberland (TBL) rose 44% and VF Corp.'s stock jumped 10%.

Wendy's/Arby's Group (WEN) rose 1%, after the restaurant operator agreed to sell Arby's to a private equity group led by Roark Capital Group. Wendy's will retain an 18.5% ownership interest in the roast beef chain's business.

These deals were some of the first M& A activity Wall Street had seen in weeks.

" It's an emotional confirmation that businesses continue to deal despite the economy," said Bruce McCain, chief investment strategist at Key Private Bank.

U.S. stocks tumbled Friday, with each of the three key indexes falling more than 1%, and the Dow ending below 12,000 for the first time in months.

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Companies: Sears Holdings (SHLD, Fortune 500) was the second-best performing stock in the S& P 500, rising more than 5%.

Honeywell (HON, Fortune 500) announced plans to acquire EMS Technologies (ELMG) for $491 million in cash. Honeywell shares edged higher, while EMS shares jumped 32%.

European Insurance company Allied World Assurance (AWH) agreed to buy U.S. insurance company Transatlantic Holdings (TRH) for approximately $3.2 billion in an all-stock deal. Transatlantic shares rose 10%, while Allied World shares were down 4.5%.

Shares of Citigroup (C, Fortune 500) rose 3% despite a Wall Street Journal report that said the bank waited three weeks before notifying customers of a credit card hack attack.

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Bonds: The price on the benchmark 10-year U.S. Treasury edged slightly higher Monday afternoon, pushing the yield down to 2.96% from 2.97% late Friday.

World markets: European stocks finished higher. Britain's FTSE 100 and the DAX in Germany edged up 0.2%, and France's CAC 40 added 0.1%. Europe markets were closed by the time the S& P Greece downgrade was announced.

Asian markets ended mixed. The Shanghai Composite lost 0.2% and Japan's Nikkei slumped 0.7%, while the Hang Seng in Hong Kong added 0.4%.

China is slated to release its latest consumer price data overnight. Investors will be looking at the report closely for any hints of a slowdown in growth.   

The Dow Jones industrial average (INDU) fell 22 points, or nearly 0.2%, to 12,049. The S& P 500 (SPX) dipped 5 points, or 0.4% to 1,279. The Nasdaq (COMP) sank 26 points, or 0.9%. to 2,675.

Shares of Alcoa (AA, Fortune 500) fell over 2%, making it the worst performing Dow stock. But the index was supported by Verizon (VZ, Fortune 500), which rose 1% after analysts at Oppenheimer upgraded the stock.

After the market closed, Texas Instruments (TXN, Fortune 500) lowered its outlook for second-quarter earnings and revenue. Shares of the technology company fell 4.5% in extended trading.

Oil prices jumped nearly 2% to settle near $101 a barrel after OPEC failed to reach an agreement on crude production levels.

The spike in crude prices lifted shares of energy producers Cabot Oil and Gas (COG), Apache Corp. (APA, Fortune 500) and Occidental Petroleum (OXY, Fortune 500), among others.

Exxon Mobil (XOM, Fortune 500) rose nearly 1%, after the company announced three new oil and gas discoveries in the Gulf of Mexico that could produce 700 million barrels of product.

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Credit card companies Visa (V, Fortune 500) and MasterCard (MA, Fortune 500) came under pressure after the Senate failed to delay rules capping fees that banks charge retailers to process debit card transactions by consumers.

Overall, the tone on Wall Street has been bearish as investors remain rattled by recent signs that the economic recovery has stalled.

" We've had a slew of bad news," said Abigail Doolittle, the founder of Peak Theory Research.

She said the market has shown some resilience and that stocks could bounce higher over the short term. But she was less optimistic about the bigger picture.

" Over the long term, the bad news will outweigh the good news, and that will pressure the S& P lower from here," she said.

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The economic gloom hanging over the market was reinforced late Tuesday by comments from Federal Reserve chairman Ben Bernanke, which killed a modest stock rally.

Economy: The Fed released the latest edition of its Beige Book, which describes economic conditions across the central bank's 12 districts.

The report showed that economic activity continued to expand at a moderate pace in most districts.

But growth slowed in at least four districts, while the Dallas Fed reported an acceleration in activity, according to the Beige Book.

Companies: Hovnanian (HOV) reported disappointing earnings results after the market close Tuesday, sending shares of the homebuilder about 12% lower Wednesday.

LDK Solar (LDK) shares fell more than 7% after the company issued a cautious outlook.

Shares of telecommunications company JDS Uniphase (JDSU) were down sharply. Retail clothing companies Abercrombie & Fitch (ANF) and Urban Outfitters (URBN) were also under pressure.

Currencies and commodities: The dollar rose against the euro and the British pound, but slipped versus the Japanese yen.

Gold futures for August delivery fell $2.70 to $1,536.00 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury edged up, pushing the yield down to 2.96% from 2.99% late Tuesday.

World markets: European stocks closed lower Wednesday. Britain's FTSE 100 shed 0.8%, the DAX in Germany dropped 0.6% and France's CAC 40 fell 0.5%.

The declines came amid reports that Moody's has determined the U.K.'s credit rating is at risk of being downgraded.

Asian markets ended the session mixed. The Shanghai Composite ticked up 0.2% and Japan's Nikkei added 0.1%, while the Hang Seng in Hong Kong slipped 0.9%. 

A variety of recent reports have showed the recovery slowed in May, and given that the Federal Reserve's $600 billion stimulus runs out later this month, investors are especially jittery about the strength of the economy going forward. 

" There's a sense that liquidity has helped the market a lot more than it has helped the economy, and there is a day of reckoning ahead," said Uri Landesman, president of Platinum Partners.

The Dow Jones industrial average (INDU) fell 61 points, or 0.5%, with JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500) the biggest drags on the blue-chip index. Of the Dow's 30 components, 23 posted losses.

The S& P 500 (SPX) shed 14 points, or 1.1%, and the tech-heavy Nasdaq (COMP) slipped 30 points, or 1.1%.

" Investors are really trading on emotions right now -- and unfortunately, most people are pessimistic," said Jack Ablin, chief investment officer of Harris Private Bank in Chicago.

U.S. stocks fell sharply on Friday, following a weak May jobs report.

The Dow and S& P have each declined roughly 5% since the beginning of May, amid weak reports on home prices, unemployment claims and manufacturing.

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Companies: Apple (AAPL, Fortune 500) investors adhered to the common Wall Street saying " buy on the rumor, sell on the news," Monday.

Shares of the tech giant fell 1.6% after CEO Steve Jobs' unveiled iCloud , a free service that will store and sync documents, photos and other content across Apple devices. (Read Fortune's live blog of the event at the Worldwide Developers Conference in San Francisco.)

The biggest gainer in the S& P 500, Harley-Davidson (HOG, Fortune 500), saw its shares rise 2.8% after UBS Investment Research called the motorcycle maker a short-term buy, citing strong May sales.

Also bucking the day's downward trend, Starbucks (SBUX, Fortune 500) shares rose 1.7% after analysts at BMO Capital boosted their rating on the coffee retailer to " outperform." The analysts raised their price target for the stock to between $40 and $45 -- a more than 13% premium over Friday's closing price.

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

Oil for July delivery slipped $1.21 to settle at $99.01 a barrel.

Gold futures for August delivery edged up $4.80 to settle at $1,547.20 an ounce.

Bonds: Treasury yields traded in spitting distance of six-month lows Monday. The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 3.01% from 3.00% late Friday.

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World markets: European stocks ended their session mixed. Britain's FTSE 100 rose 0.2%, the DAX in Germany dipped 0.2% and France's CAC 40 fell 0.8%.

In Asian markets, Japan's Nikkei finished 1.2% lower. The Shanghai Composite and the Hang Seng in Hong Kong were closed for holidays. 

The Dow Jones industrial average (INDU) fell 42 points, or 0.3%, to end at 12,249, with Wal-Mart (WMT, Fortune 500) and Chevron (CVX, Fortune 500) the biggest drags on the blue-chip index. At one point in the session, the Dow stumbled nearly 100 points.

The S& P 500 (SPX) lost 2 points, or 0.1%, to 1,313 and the Nasdaq Composite (COMP) rose 4 points higher, or 0.2%.

Retail stocks pressured the broader market throughout the day, as major retail chains reported mostly disappointing same-store sales. Limited Brands (LTD, Fortune 500), Kohl's (KSS, Fortune 500) and Gap (GPS, Fortune 500) were among the worst performers on the S& P 500.

" Those are some pretty big names giving some disappointing numbers," said Frank Davis, senior equity trader with Wedbush Morgan Securities. " It adds to the already-heightened anxiety over the recent economic data."

Investors also remained sharply focused on the labor market. Weekly jobless claims stayed above the 400,000 level for the eighth straight week.

" Jobless claims have taken a lot more meaning over the last several weeks," said Mark Luschini, chief investment strategist at Janney Montgomery Scott.

The figure takes on even more importance in light of Wednesday's " shockingly weak" private sector jobs report, Luschini added. Both reports come ahead of the government's key monthly jobs report on Friday.

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A CNNMoney survey of 26 economists expect a total gain of 170,000 jobs, and a private sector gain of 190,000 with the unemployment rate edging down to 8.9%.

Signs of a stalling recovery have been building, with stocks delivering their worst monthly performance in May since August 2010. But all three indexes are still up for the year so, while the daily gyrations may give investors nausea, the trend is still higher.

Stocks fell sharply Wednesday, with the Dow and S& P 500 posting their steepest losses in nearly a year, following weak reports on jobs and manufacturing. A late downgrade on Greece's debt added to the rout.

Economy: The U.S. Commerce Department said April factory orders fell 1.2% -- slightly more than the 1% decline economists had expected.

Moody's said would consider downgrading the United States' AAA rating if Congress failed to act on the debt ceiling.

Companies: Shares of the for-profit education stocks jumped, after the Department of Education issued its final rules that aim to halt federal aid to schools whose graduates cannot earn enough to repay their loans.

Shares of Corinthian Colleges (COCO) spiked 27%, while shares of Apollo Group (APOL, Fortune 500) rose 11% on the news. Bridgepoint Education's (BPI) stock added 3%.

Online coupon company Groupon filed for a $750 million initial public offering on Thursday. Groupon plans to trade under the symbol " GRPN."

In the financial sector, Goldman Sachs (GS, Fortune 500) shares slid more than 1% on reports that the Manhattan Attorney General's office is investigating the bank.

Currencies and commodities: The dollar fell 1% against the euro. The greenback was also lower versus the Japanese yen and the British pound.

Oil for July delivery closed up 11 cents to $100.40 a barrel. AAA reported Thursday morning that gas prices rose to $3.784 per gallon, following 20 consecutive decreases.

Gold futures for July delivery dropped $10.50 to $1,535.50 an ounce.

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Bonds: The price on the 10-year U.S. Treasury fell, pushing the yield up to 3.03%. On Wednesday. the benchmark yield fell below 3% Wednesday for the first time since December.

World markets: Global markets fell sharply following Wall Street's deep losses on Wednesday, and as investors digested yet another downgrade on Greece debt.

Britain's FTSE 100 slid 1.4%, while the DAX in Germany and France's CAC 40 tumbled nearly 2%.

In Asia, the Shanghai Composite lost 1.4%, the Hang Seng in Hong Kong declined 1.6%, and Japan's Nikkei sank 1.7%.

Japan's market was under pressure amid domestic political turmoil. Japanese Prime Minister Naoto Kan survived a no-confidence vote in Parliament Thursday, by promising he will resign after the country's nuclear crisis is under control.   

In fact, the market's performance in May was the worst since August 2010. The Dow tumbled nearly 2% for the month, while the S& P 500 and the Nasdaq lost 1.3%.

May has been a rough month for the stock market as investors wrestle with signs of a slower recovery.

On Tuesday, investors sifted through yet another batch of weak U.S. economic data that showed a decline in home prices, regional manufacturing activity and consumer confidence.

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But optimism about the possible bailout for Greece, sparked by a Wall Street Journal article, gave stocks a boost.

The Dow Jones industrial average (INDU) surged 128 points, or 1%. All but one of the Dow's components posted gains, with Pfizer (PFE, Fortune 500), Cisco (CSCO, Fortune 500) and Alcoa (AA, Fortune 500) leading the advance.

The S& P 500 (SPX) added 14 points, or 1.1%, and the Nasdaq Composite (COMP) gained 38 points, or 1.4%.

The Journal reported that Germany is shifting its stance to consider lending more money to debt-ridden Greece. Previously, German officials had said that private investors in Greece should share some of the burden in any new bailout, but according to the Journal, Germany is now considering lending additional assistance -- even without private bondholders getting involved.

" The market is battling between growing fears that the U.S. economy is headed toward another downturn, and some progress on the European debt problems," said Peter Tuz, president at Chase Investment Counsel.

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U.S. investors are also gearing up for the government's highly anticipated monthly jobs report on Friday.

CNNMoney's survey of economists forecast that the U.S. economy created 178,000 jobs in May, down from 244,000 jobs a month earlier. The unemployment rate is expected to tick down to 8.9% from 9%.

U.S. stocks rose modestly last Friday, with trading volume light as traders positioned themselves for a long holiday weekend. The stock market was closed Monday for Memorial Day.

Economy: According to the closely watched S& P Case-Shiller Index, home prices recently fell to their lowest levels since the housing bubble burst. Prices tumbled 4.2% in the first quarter, sending home prices back to levels not seen since mid-2002.

The Chicago Purchasing Managers index fell more than expected to 56.6 in May, from 67.6 the previous month. Economists were expecting the figure to slip to 62.5.

The Conference Board's consumer sentiment index declined to 60.8 in May, from 65.4 in April. Economists were expecting consumer confidence to rise to 66.3.

Companies: Shares of Nokia (NOK) tumbled 14%, after Nokia issued a sales warning that the second quarter will be lower than previously expected. The cell phone maker, which has been losing market share to Apple (AAPL, Fortune 500) and Google (GOOG, Fortune 500), also lowered its full-year outlook.

Shares of Apple rose 3% after the company said that CEO Steve Jobs, who is on medical leave, will introduce the iCloud service during the Worldwide Developers Conference keynote on June 6 in San Francisco.

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World markets: European stocks climbed Tuesday. Britain's FTSE 100 rose 0.9%, the DAX in Germany surged 1.9%, and France's CAC 40 added 1.6%.

Asian markets ended sharply higher. The Shanghai Composite rose 1.4%, the Hang Seng in Hong Kong gained 2.2% and Japan's Nikkei added 2%.

Early Tuesday, Moody's placed 12 Japanese regional governments on review for a possible downgrade.

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

Oil for July delivery rose $2.11, or 2.1%, to settle at $102.70 a barrel.

Gold futures for August delivery slipped 50 cents to settle at $1,536.80 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 3.05% from 3.06% late Friday.   

The Dow Jones industrial average (INDU) rose 8 points, or 0.1%, to end at 12,403 the S& P 500 (SPX) added 5 points, or 0.4%, to 1,326 and the tech-heavy Nasdaq Composite (COMP) gained 22 points, or 0.8%, to close at 2,783. The Dow had been down more than 70 points earlier in the session.

Technology shares helped offset broader market losses, with technology blue chip Microsoft (MSFT, Fortune 500) rising 2% and Hewlett-Packard (HPQ, Fortune 500) gaining 1.5%. Microsoft shares were higher after large shareholder David Einhorn called for CEO Steve Ballmer to step down.

" All these tech giants like Microsoft, Dell, HP have gotten so big, they're very hard to manuveur," said Daniel Morgan, portfolio manager with Synovus Trust Co., who also owns Microsoft shares.

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Among other tech names, NetApp (NTAP) shares jumped 7% after the data storage company reported strong quarterly results late Wednesday and issued an upbeat outlook for the current quarter.

The biggest decliners among the blue chips were Merck (MRK, Fortune 500) and Home Depot (HD, Fortune 500), which were both down roughly 1%.

Stocks have been struggling this month, as optimism over upbeat corporate earnings has been tempered by signs the economy could be entering a slowdown this summer.

Evidence of a weaker economy was prevalent in two economic reports released Thursday morning.

The number of Americans filing for first-time unemployment benefit claims remained above 400,000 for the seventh week in a row. Additionally, the government's revised reading on first-quarter growth domestic product remained at 1.8%. Economists expected GDP to bump up to 2%.

" The data doesn't bode well for the summer," said Stephen Carl, head trader with Williams Capital.

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May has been a volatile month for stocks overall, with the Dow and S& P 500 both falling about 3.2% since the beginning of the month.

Analysts at Standard & Poors are predicting the stock market could be in for a 10% correction over the next month.

" The global equity markets continue to wrestle with the paradox of rising earnings estimates and declining global economic growth indicators," said Sam Stovall, chief investment strategist with Standard & Poor's Equity Research, in a note to investors Wednesday.

Stocks posted modest gains Wednesday, but are in negative territory for the week overall.

Companies: Shares of Tiffany & Co. (TIF) rose more than 8.5%, after the luxury jeweler reported a 12% jump in sales. The company also hiked its quarterly dividend payment to 29 cents per share from 25 cents.

Signet Jewelers (SIG) also fared well, with its stock rising 5%. The retailer, which operates Kay Jewelers, Jared, The Galleria Of Jewelry and chains in the U.K., got a big boost from U.S. sales in its latest quarter.

Shares of MasterCard (MA, Fortune 500) rose 3%, following a joint announcement by Google (GOOG, Fortune 500) -- along with MasterCard and Sprint (S, Fortune 500) -- of a new mobile payment system called Google Wallet.

Computer Sciences Corp.'s (CSC, Fortune 500) shares dropped 13%, after the company's quarterly results came in short of expectations. The company said it earned an adjusted profit of $1.01 a share, while analysts were looking for $1.16 a share.

Freescale Semiconductor (FSL) priced its initial public offering at $18 a share, below its estimated range of between $22 and $24 per share. Shares rose 2% following its IPO.

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

Oil for July delivery dropped $1.09, or 1.1%, to $100.23 a barrel.

Gold futures for June delivery slid $4.10 to $1,523.20 an ounce. Silver for June delivery fell 0.8% to $37.33 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, pushing the yield down to 3.09% from 3.14% late Wednesday.

World markets: European stocks closed Thursday's session mixed. Britain's FTSE 100 rose 0.2%, while the DAX in Germany slid 0.8% and France's CAC 40 fell 0.3%.

Asian markets ended mixed. The Shanghai Composite edged lower 0.2%, while the Hang Seng in Hong Kong added 0.7% and Japan's Nikkei rallied 1.5%. 

All of that means that " gains will be harder to come by," warned Bob Doll, BlackRock chief equity strategist, in a recent client note. On the bright side, the uptrend will continue, " but at a more challenged pace," he added.

It's already been a choppy week and it's only Tuesday. After getting hammered in the previous session, stocks were struggling to recover.

The Dow Jones industrial average (INDU) slipped 25 points, or 0.2%, with GE (GE, Fortune 500) and American Express (AXP, Fortune 500) pressuring the blue chip index. Chevron (CVX, Fortune 500) and Exxon Mobil (XOM, Fortune 500), which got a boost from oil prices, were among the biggest gainers on the Dow.

Crude prices rose nearly 2% to close just under $100 a barrel. The spike came after Goldman Sachs boosted its forecast for Brent oil -- the European benchmark -- to $120 a barrel by year's end.

The Nasdaq Composite (COMP) lost 13 points, or 0.5%, and the S& P 500 (SPX) lost 1 point, or 0.1%.

May has been especially rough for the stock market. The Dow and S& P 500 have both lost more than 3%, and the Nasdaq has tumbled 4% since the start of the month.

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" The recently weaker tone in equity markets can be attributed to a broad slowdown in economic data," Doll said. " Outside of the United States, investors remain focused on the sovereign debt problems plaguing Europe."

Rating agencies Standard and Poor's and Fitch have issued pessimistic outlooks for Greece, Italy and Belgium during the last few days.

" Europe's debt problems are like a hurricane off the coast," said Jack Ablin, chief investment officer at Harris Private Bank. " We know it's coming, and now we want to know how much damage it will ultimately inflict."

On top of that, investors are also preparing for the conclusion of the Fed's bond buying program in June, which some experts say has been the prominent driver in the stock market's gains since Ben Bernanke first mentioned it last August.

While the risks may put a lid on gains in the near-term, investor's don't need to worry about an end to the two-year old bull market. Stocks have doubled from their March 2009 lows -- at a record pace.

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And for the year, stocks remain in positive territory: The Dow is up nearly 7% while the S& P 500 and Nasdaq are about 4% higher.

Economy: A government report showed that new home sales rose 7.3% to an annual rate of 323,000 units in April. Economists were expecting an annual rate of 300,000 sales for April.

Companies: AutoZone (AZO, Fortune 500) was among the S& P 500's best performers. Shares of the auto parts retailer jumped 6% after the company delivered quarterly earnings and sales above expectations.

Shares of entertainment products maker Sony (SNE) rebounded, ticking up 5%. Shares slipped nearly 4% in the previous session following disappointing quarterly results due to the earthquake and tsunami in Japan.

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Russian search giant Yandex (YNDX) debuted on the Nasdaq under the ticker 'YNDX' after going public late Monday. The stock jumped almost 60% from its IPO price of $25 a share.

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

Gold futures for June delivery rose $7.90 to $1,523.30 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose slightly, pushing the yield down to 3.12% from 3.13% late Monday.

World markets: After global markets sank in the previous session on concerns that eurozone debt woes will continue to spread, European stocks rebounded in Tuesday. Britain's FTSE 100 and the DAX in Germany added 0.4% and France's CAC 40 rose 0.3%.

Asian markets ended mixed. The Shanghai Composite edged lower 0.3%, while the Hang Seng in Hong Kong ticked up 0.1% and Japan's Nikkei rose 0.2%. 

The Dow Jones industrial average (INDU) added 66 points, or 0.5%, the S& P 500 (SPX) rose 7 points, or 0.5%, and the Nasdaq Composite (COMP) gained 18 points, or 0.6%. Earlier in the session, all three indexes were down as much as 0.7%.

Stocks had started the day in sell mode, weighed down by lower commodity prices and a dour outlook from Cisco Systems. But the momentum shifted midday as commodities erased earlier losses and the dollar pulled back against the euro.

Oil prices rose almost 1% to settle at $98.97 a barrel. Earlier, crude had sold off more than 3%. Gold prices also turned higher, rising 0.4% to $1.507.40 an ounce. Silver remained in the red, but was only off 2% to $34.80 an ounce.

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" You don't have to look at the stocks anymore to know what's going on. You just need to look at commodities," said Donald Selkin, chief market strategist at National Securities. " But that makes me sick."

Stocks and commodities have been moving in tandem lately as investors have started considering rising commodity prices a sign of strength for the global economy.

But Selkin argues that higher oil prices hurt consumers, who may pull back on spending after having to shell out more cash at the gas pump.

Meanwhile, shares of big oil companies Exxon Mobil (XOM, Fortune 500), Chevron (CVX, Fortune 500), ConocoPhillips (COP, Fortune 500), Shell (RDSA), BP (BP) also stabilized as the companies' CEOs defended their tax breaks before Congress.

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Stocks fell sharply Wednesday, as energy and materials stocks got slammed by a sell-off in oil and gasoline futures.

Economy: The number of people who filed for first-time unemployment benefits in the most recent week fell to 434,000, down from the previous week but worse than economists' expectations.

Initial unemployment claims have been stuck above the key 400,000 level for four weeks.

Meanwhile, retail sales rose 0.5% in April, according to the Commerce Department, but the bulk of the gains came from increasing gas and food prices.

The Producer Price Index for finished goods rose 0.8% in April, seasonally adjusted, according to the government. That followed a 0.7% increase in March.

The Commerce Department said business inventories rose 1% in March. Economists were expecting inventories to rise 0.9% during the month, after a 0.7% increase in February.

Companies: Shares of Cisco Systems (CSCO, Fortune 500) fell nearly 5%, dragging on all three indexes. The Dow component posted better-than-expected earnings after the bell Wednesday, but CEO John Chambers issued a tepid outlook for the coming quarter.

Shares of Kohl's (KSS, Fortune 500) rose 3.9% after the department store chain posted a $211 million quarterly profit, up 6% from a year earlier, as sales rose 3% to $4.2 billion. Kohl's also raised its full-year outlook.

World markets: European stocks closed lower. Britain's FTSE 100 lost 0.5%, the DAX in Germany fell 0.7% and France's CAC 40 dropped 0.9%.

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Asian markets ended the session lower. The Shanghai Composite fell 1.4%, the Hang Seng in Hong Kong lost 0.9% and Japan's Nikkei plunged 1.5%.

The People's Bank of China once again raised the bank reserve rate by 0.5 percentage points as it continues to work on reeling in its red hot economy.

According to its most recent figures, China's economic growth slowed in April, with the country's inflation rate easing a bit. It's still unclear, though, whether that signals the start of a prolonged cooling period or not.

Currencies and bonds: The dollar erased its gains against the euro, falling 0.3%. It remained higher versus the British pound. The greenback was slightly lower against the Japanese yen.

The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 3.23%.   

" Commodities are getting crushed here, and it's taking the whole market with it," said David Rovelli, managing director of U.S. equity trading at Canaccord Adams.

The Dow Jones industrial average (INDU) slid 130 points, or 1%, to end at 12,630. The blue-chip index had been down as much as 179 points. The S& P 500 (SPX) fell 15 points, or 1.1%, to 1,342 and the Nasdaq Composite (COMP) shed 27 points, or 0.9%, to end at 2,845.

Shares of Chevron (CVX, Fortune 500) and Exxon Mobil (XOM, Fortune 500) were among the biggest laggards on the Dow as oil plunged nearly 6% to $100 a barrel. Gasoline futures also got hammered, tumbling 8% to $3.11 a gallon.

The selling intensified after the Energy Department's weekly inventory report showed a surprise build in gasoline supplies.

The drop in energy prices also drove down shares of energy firms Halliburton (HAL, Fortune 500), Cabot Oil (COG) and Tesoro (TSO, Fortune 500), among others.

Precious metals were also selling off, with silver sinking $3.26, or 8.5%, to $32.22 an ounce. And gold fell $13.40, or 0.9%, to $1,503.50 an ounce.

Copper was also getting caught up in the selling mayhem, with prices sinking 3.5%. That spilled over to miner stocks, including Freeport McMoRan (FCX, Fortune 500) and Teck Resources (TCK).

Traders also pointed to weakness in the euro as part of the reason commodities were under pressure. The dollar gained strength amid growing concerns about Greece's debt problems.

" We're now looking at a strong likelihood that Greece will need to default in some form," said Brian Dolan, Forex.com's chief currency strategist.

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One of the lone bright spots was Intel (INTC, Fortune 500), whose shares rose 1.7% after the chipmaker hiked its quarterly dividend to 21 cents a share.

Investors moved into defensive sectors such as consumer staples, utilities and health care stocks. Both utilities and health care have been particularly strong performers as of late, a sign that investors are becoming increasingly hesitant.

" It's time to be a little bit cautious," said Russell Lundeberg, chief investment officer with Barrett Capital Management. " These volatile swings show that fundamentals are not moving this market any more, so you have to be sure you're being paid for any amount of risk you're willing to take on at this point."

Wednesday's drop came after U.S. stocks rose Tuesday, thanks to investors encouraged by Microsoft's $8.5 billion deal to buy Skype, along with solid corporate earnings reports and economic data.

Companies: Shares of Dow component Walt Disney (DIS, Fortune 500) fell more than 5% after the company reported earnings that fell far short of forecasts.

Yahoo! (YHOO, Fortune 500) shares slid more than 7%, making it the worst performer in the S& P 500, on investor concerns about the value of its China-based assets.

Automaker Toyota (TM) said Wednesday that net income almost doubled and sales increased 0.2% for the fiscal year ended March 31. But the earthquake that hit Japan earlier this year cost the company about ¥100 billion. Toyota shares rose 0.5%.

Also, insurer AIG (AIG, Fortune 500) and the Treasury decided to move ahead with a $9 billion stock offering, despite the recent low price of the stock. Shares of AIG rose 3.6%.

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Department store chain Macy's (M, Fortune 500) posted a profit of 30 cents a share, well above the 17 cents analysts were looking for. The company also announced it was doubling its quarterly dividend to 10 cents per share. Macy's shares jumped 8%, making it the best performer on the S& P 500.

Dow component Cisco Systems (CSCO, Fortune 500) reported earnings of 42 cents a share, beating analysts' estimates of 37 cents. CSCO rose 4% in aftermarket action.

Economy: The U.S. trade deficit widened to $48.2 billion in March, the Commerce Department said Wednesday. Economists were expecting a $47.7 billion trade deficit.

In Asia, China's food price surge slowed, helping to ease overall inflation in April. China's consumer price index rose at an annual rate of 5.3%, down from 5.4% growth in March.

Currencies and bonds: The dollar rose more than 1% against the euro but remained weak against the British pound and the Japanese yen.

Meanwhile, the price on the benchmark 10-year U.S. Treasury rose modestly, with the yield falling to 3.16%.

World markets: European stocks closed mixed. Britain's FTSE 100 fell 0.7%, the DAX in Germany lost 0.1% and France's CAC 40 added 0.1%.

Asian markets ended mixed. The Shanghai Composite lost 0.3%, the Hang Seng in Hong Kong shaved 0.2% and Japan's Nikkei rose 0.5%. 

" There are just a lot of strong numbers, from earnings to economic data, that keep pushing this market higher," said Frank Davis, director of sales and trading at LEK Securities.

The Dow Jones industrial average (INDU) rose 76 points, or 0.6%, to close at 12,761 the S& P 500 (SPX) gained 11 points, or 0.8%, to 1,357 and the tech-heavy Nasdaq Composite (COMP) added 29 points, or 1%, to close at 2,872.

Shares of Intel (INTC, Fortune 500), Hewlett-Packard (HPQ, Fortune 500) and Cisco (CSCO, Fortune 500) were among the Dow's top performers, all rising by more than 1%, while Microsoft (MSFT, Fortune 500) was the biggest drag on the blue-chip index, falling 0.5%.

Leading the Dow was media giant Disney (DIS, Fortune 500), shares of which rose more than 2% before the company's quarterly results. After the bell, Disney reported earnings of 49 cents per share, missing analyst forecasts for 57 cents a share. Disney stock fell 3% in aftermarket trading.

Investors also focused on U.S. import-export data, wholesale inventories and quarterly home prices, as well as the strong Chinese trade report.

Early Tuesday, the Chinese government said China's trade surplus surged to $11.43 billion in April, growing for the second month in a row.

While stocks continue to move higher, there are signs that Wall Street is becoming more defensive. Utilities were among Tuesday's top performers, with companies such as ConEd (ED, Fortune 500), Pacific Gas & Electric (PGE) and American Electric Power (AEP, Fortune 500) all up at least 1%. Healthcare stocks, another defensive sector, were also doing well.

" When you see those sectors outperforming the broader market, that's a signal that investors are getting more cautious," said Quincy Krosby, chief market strategist with Prudential Financial. " I think we're beginning a topping-out process for stocks, unless the economic data like jobless claims starts to improve."

U.S. stocks rose Monday, as commodity prices bounced back. But the gains were tempered by worries about the fiscal crisis in Greece.

Economy: U.S. home prices continued their sharp drop during the first three months of the year, according to a report by the National Association of Realtors. The average price on a single family home in the U.S. now stands at $158,700, down 4.6% from a year ago.

The price of imports into the United States increased 2.2% in April, while exports only advanced 1.1%, according to a report released by the Labor Department.

The Commerce Department said wholesale inventories rose 1.1% in March, which was in line with forecasts.

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Companies: Cisco shares rose 1% ahead of its quarterly results on Wednesday after the closing bell. Analysts are looking for the telecommunications and router company to earn 37 cents a share.

Shares of eBay (EBAY, Fortune 500), which owns a 35% stake in Skype, rose 2.5% in midday trading.

Dean Foods (DF, Fortune 500)' stock surged 11%, after the dairy company easily trounced earnings expectations and raised its outlook, citing improving demand.

Shares of Intercontinental Hotels (IHG), which owns Holiday Inn, rose 4% after the company reported a 30% jump in profit.

Google (GOOG, Fortune 500) unveiled its cloud-based music service on Tuesday, which will allow users to upload music for later streaming.

World markets: European stocks ended solidly higher. Britain's FTSE 100 rose 1.3%, the DAX in Germany advanced 1.3% and France's CAC 40 ticked higher 1.1%.

Asian markets finished higher. The Shanghai Composite edged up 0.6% and Japan's Nikkei rose 0.3%. Hong Kong's stock market was closed for a holiday.

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

Oil for June delivery rose $1.13, or 1.1%, to $103.63 a barrel.

Gold futures for June delivery rose $15, or 2.2%, to $1,518 an ounce.

Silver futures for July delivery gained $1.50, or 4%, to $38.66 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury edged lower, with the yield rising to 3.17%.   

The Dow Jones industrial average (INDU) rose 46 points, or 0.3%, to 12,684. The S& P 500 (SPX) gained 6 points, or 0.5%, to 1,346. The Nasdaq Composite (COMP) advanced 15 points, or 0.5%, to 2,843.

After a sharp sell-off last week, commodities rebounded Monday. Oil jumped 5% to above $102 a barrel. Silver prices gained 6% and gold rose over 1%.

" Oil lifted this morning and, as a result, we saw a move back into the highly cyclical areas," said Kevin Rendino, a senior portfolio manager at BlackRock, pointing to companies in the energy and materials sector.

Shares of Alcoa (AA, Fortune 500), Caterpillar (CAT, Fortune 500) and Chevron (CVX, Fortune 500) were among the top performers on the Dow. McDonald's (MCD, Fortune 500) rose nearly 1% after the fast-food chain said sales rose 6% in April.

But the blue-chip average was hobbled by shares of Intel (INTC, Fortune 500), which fell nearly 2%. Bank of America (BAC, Fortune 500) and JPMorgan (JPM, Fortune 500) were also weak.

With no major U.S. economic reports on tap Monday, investors were focused on worsening fiscal problems in Greece.

Standard & Poor's cut Greece's credit rating again, and warned that many of the nation's banks are at risk of further downgrades. That came on the heels of rumors last week that the debt-ridden country could abandon the euro or seek another bailout.

" Greece is clearly on the forefront of investors attention today," said Rendino. However, he added that the downgrade was not surprising, and the nation's economic woes are nothing new.

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In the United States, traders were waiting for more clarity about the state of the economy. Indicators have been mixed recently, with signs of weakness in the services sector and a surprisingly strong employment report on Friday.

" There's more fear in the market that we're in for a summer slowdown," said Paul Zemsky, head of asset allocation at ING Investment Management.

Investors are particularly concerned that the recent spike in gas prices could stifle consumer spending and undermine the economy. As such, a report due Thursday on retail sales will receive extra scrutiny, said Zemsky.

But overall, " we're still bullish on risky assets," such as stocks, he said.

Stocks edged higher Friday, as the dollar rallied and investors responded to a stronger-than-expected jobs report.

But all three indexes closed down more than 1% for the week, as weakness in commodities -- especially silver and crude -- spilled over into the broader market.

Companies: Citigroup (C, Fortune 500) conducted a 1-for-10 reverse stock split after the closing bell Friday, meaning that the number of shares outstanding were reduced to bolster the stock price. Citi's stock edged lower in early trading to $44.75. Last week, it was trading at around $4.50 a share.

Citi shares fell 1%.

Shares of Dollar Thrifty (DTG) surged nearly 12% after Hertz (HTZ, Fortune 500) announced a new offer to buy the rival rental car company.

Tyson Foods (TSN, Fortune 500) reported earnings per share that beat analysts' estimates by a penny, but the company missed on revenue. Shares fell 6%.

Economy: Among the key reports due later in the week are the March trade balance, due Wednesday, the April retail sales figures on Thursday and a reading on April consumer prices slated for Friday.

World markets: European stocks fell as investors continued to fret about Greece's debt problems. Britain's FTSE 100 edged down 0.6%, the DAX in Germany fell 1.1% and France's CAC 40 slid 1.3%.

Asian markets ended mixed. The Shanghai Composite edged up 0.3% and the Hang Seng in Hong Kong rose 0.8%, while Japan's Nikkei slid 0.7%.

China will release its latest trade gap figures overnight. Meanwhile, Treasury Secretary Tim Geithner began two days of meetings with Chinese leaders about economic issues, likely to include discussions about the yuan-dollar relationship.

Currencies and commodities: The dollar edged up against the Japanese yen, dipped against the euro and was little changed against the British pound.

Oil for June delivery gained $5.51 to settle at $102.69 a barrel.

Gold futures for June delivery rose $16.70 to close at $1,507.90 an ounce.

Silver futures for July delivery rose $2.18 to end at $37.47 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury edged up, pushing the yield down to 3.14%.