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Wall Street rebounds, all eyes on Boston

By Rodrigo Campos

NEW YORK (Reuters) - Most U.S. stocks rose on Friday, bouncing back a day after the S&P 500 closed below its 50-day moving average for the first time in 2013, but IBM's largest drop in eight years kept the Dow in slightly negative territory.

Some marquee tech names bolstered the broader market, however, and drove the Nasdaq up more than 1 percent, a day after strong earnings from Google and Microsoft.

Trading seemed to be taking place normally even as much of Boston, a major U.S. financial center and home to a number of the country's biggest mutual fund companies, was under virtual lockdown after police killed one suspect in the Boston Marathon bombing in a shootout and mounted house-to-house searches for a second man.

"We're in the John Hancock building, the tallest in Boston, and we're on complete lockdown," said David Porter, managing partner at Baystate Financial Services in Boston.

"If you weren't here by 8:30, you weren't getting in," he said.

Despite the lockdown, trading was taking place as usual.

"So far, I haven't seen anything like lower volume because of this," Porter added. "There's nothing we're unable to do because of this, except go outside."

Meanwhile, on Wall Street, markets partially recovered from the S&P 500's 3 percent drop over the previous four sessions, which set it on track to post its worst week since November.

International Business Machines (IBM.N) shares led the Dow's decline a day after the technology services company posted an earnings miss, while less-than-stellar numbers on Friday from General Electric (GE.N) and McDonald's (MCD.N) weighed further on the blue chips.

The Dow Jones industrial average (.DJI) fell 16.28 points or 0.11 percent, to 14,520.86. But the S&P 500 (.SPX) gained 11.34 points or 0.74 percent, to 1,552.95 and the Nasdaq Composite (.IXIC) added 40.21 points or 1.27 percent, to 3,206.58.

The S&P 500's close below the 50-day moving average on Thursday indicates the medium-term uptrend in the market could be in peril. The last time the index closed consecutive days under its 50-day average came in early December.

IBM posted quarterly earnings that missed estimates due to the Japanese yen's depreciation and a failure to close major deals, especially in Europe and the United States. IBM's stock was down 7 percent to $192.64, its largest daily percentage drop since April 15, 2005.

GE shares fell 3.8 percent to $21.82 after the conglomerate reported a quarterly profit in line with expectations as GE sold more jet engines and shed its stake in NBC Universal. The stock topped the New York Stock Exchange's list of most actively traded names by volume at midday on Friday.

McDonald's stock lost 1.8 percent to $100.03 after the world's biggest fast-food chain reported a first-quarter profit that fell short of Wall Street's expectations and said sales at established U.S. restaurants fell 1.2 percent.

In the tech sector, some big names gave some investors a reason to buy equities.

Google's (GOOG.O) stock shot up 2.9 percent to $787.97 and helped lift the broader market a day after the company released results. Google said late Thursday that its core Internet business increased net revenue 23 percent in the first quarter, softening the effect of a sharp decline in its Motorola mobile phone division.[ID:nL2N0D52MJ] At least six brokerage firms have raised their target on Google's stock price.

Shares of Microsoft (MSFT.) jumped 3.3 percent to $29.73 and topped the Nasdaq's most-active list a day after the company reported quarterly revenue and earnings that exceeded Wall Street's expectations. Microsoft also said late Thursday that Chief Financial Officer Peter Klein is leaving at the end of June, after 3-1/2 years in the job as the world's largest software maker struggles with sliding personal computer sales and a tepid reception for its new Windows 8 operating system.

Another bright spot came from Vertex Pharmaceuticals (VRTX.O), which said Thursday that an experimental drug improved lung function in adults with cystic fibrosis in a midstage trial. Its shares surged nearly 59 percent to $83.85.

(Reporting by Rodrigo Campos and Ryan Vlastelica; Editing by Kenneth Barry, Nick Zieminski and Jan Paschal)

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