Wall Street edges up as 4-year high eyed; Apple sets record

NEW YORK (Reuters) - U.S. stocks edged higher on Friday with traders eyeing a breakout to a new four-year peak and a new all-time high for APPLE (AAPL.NQ) shares boosting the market.

The S&P 500 jumped above the closely watched 1,400 level in the last session, posting its biggest gain in two weeks and lining the index up for a move to its highest level since May 2008, just a handful of points above current levels.

The CBOE VIX volatility index , seen as a measure of investors concern on Wall Street, hit a 5-year low, down 5.7 percent to 13.47 in a sign that investors are less concerned about risk than they have been.

With few news headlines and light participation during peak holiday season, traders are increasingly taking their cues from market technicals. The S&P 500 needs to close above 1,419.04, the index's April high to make a new four-year high.

"We continue to consolidate our gains up at these levels," said David Lutz, managing director of trading, Stifel Nicolaus Capital Markets in Baltimore. "We could easily see consolidation between 1,400 and 1,425 over the next week before we break up to the 1,425-1,450 range."

Shares in Apple jumped to an all-time intraday high, rising 1.2 percent to $644.13. Broker Jefferies raised its price target on the stock to $900 from $800 and gave it a 'buy' rating.

"More price targets are going up on the Street on Apple and more people are talking about the (Apple) television, so I think that's a gorilla holding the market up to a degree," said Lutz.

The Dow Jones industrial average gained 16.86 points, or 0.13 percent, to 13,266.97. The Standard & Poor's 500 Index rose 1.08 points, or 0.08 percent, to 1,416.59. The Nasdaq Composite Index added 7.91 points, or 0.26 percent, to 3,070.30.

Facebook shares continued to slide after the expiration of a lockup period on some of the company's stock following its initial public offering. The shares fell as much as 4.3 percent to a record low of $19.01.

Groupon Inc also slumped 9.6 percent to a new low on Friday after Evercore Partners analyst Ken Sena downgraded shares of the largest daily deal company and set a $3 price target on the stock. It fell 49 cents to $4.51.

The S&P 500 has risen 2.6 percent in August and nearly 11 percent since a year low in June as traders eye some encouraging U.S. jobs data and highly anticipated policy meeting at the European Central Bank and the Federal Reserve in September.

The economic data on Wednesday was mixed and did little to provide direction for the market.

The Thomson Reuters/University of Michigan consumer sentiment survey for August rose to its highest since May to 73.6, buoyed by sales at retailers and low mortgage rates.

Separately, the Conference Board said its leading economic index climbed 0.4 percent, reversing a 0.4 percent decline in June and pointing to slow growth through the end of 2012.

"It's interesting because we've had this mixed bag from the economic data. Today's is a good step and yesterday was a little disappointing, with the housing data, so we are all just kind of wondering, is this recovery real?" said Ryan Detrick, senior technical strategist, Schaeffer's Investment Research in Cincinnati, Ohio.

"At the same time, it is August, so we are kind of taking a breath and getting ready for the Fed." Federal Reserve policymakers could give clues to future actions at a conference at the end of August.

Trading volume, which has been meager over the past several sessions during a seasonally slow period, could be even lighter heading into the weekend. This week has seen the lowest and second lowest full-day trading volumes of the year.

The low was hit on Monday with just 4.54 billion shares changing hands across the Nasdaq, the NYSE and the Amex, about two thirds of the daily average this year.

The S&P rallied for six days through August 10, its longest run of gains since December 2010, boosted by the anticipation of more actions from central banks in the United States and euro zone to stimulate their respective economies in September.

The S&P 500 recorded its biggest percentage gain since August 3 to a four-month peak on Thursday after comments from German Chancellor Angela Merkel reinforced investor expectations for action to tackle the euro zone debt crisis.

Gap advanced 5.1 percent to $36.10 after the clothing retailer posted a higher quarterly profit and raised its full-year forecast. The Morgan Stanley retail index gained 1.2 percent.

Marvell Technology Group Ltd dropped 15 percent to $10.43 after the chipmaker posted second-quarter earnings and said current-quarter results may miss expectations.

(Editing by Kenneth Barry)