Despite the late pullback, analysts said that Wall Street was cheered by an offer by Oracle to buy rival software maker PeopleSoft and that investors sense the market has hit bottom and the economy is turning around.

The Oracle bid for PeopleSoft "puts excitement in the market and it has people talking about what other combinations might happen," said Arthur Hogan, chief market analyst at Jefferies & Co.

But investors, concerned that stock prices had risen too high, too quickly, paused midway through the session to begin cashing in some profits.

After rising as much as 17.55 to hit 1,007.69, the S&P closed down 2.38, or 0.2 percent, at 987.86. The S&P hadn't traded above 1,000 since June 28, 2000, and has not closed above that mark since June 20.

The Dow closed up 21.49, or 0.2 percent, at 9,062.79 after climbing as much as 174.58 earlier in the session. In the past six winning sessions, the Dow advanced 351.61 points and on Wednesday closed above the 9,000 mark for the first time in nearly 10 months.

The Nasdaq composite index, which has been trading at levels not seen in just over a year, fell 18.59, or 1.1 percent, to 1,627.42.

It was one of the heaviest trading days of the year and there were as many advancing issues as decliners on the New York Stock Exchange.

All three indices ended the week with solid gains. For the S&P, up 2.5 percent for the week, and the Nasdaq, up 2 percent, it was the seventh winning week out of the past eight. The Dow, up 2.4 percent, has risen in six of the past eight weeks.

Investors have been bidding shares higher for about three months amid enthusiasm brought on by surprisingly strong first-quarter earnings, a quick end to the war in Iraq and more robust economic data.

By the end of today's trading, the Dow had risen 20.4 percent, the Nasdaq had gained 28 percent and the S&P had climbed 23.4 percent since March 11, which is when the buying began.

"You can see the sideline money pouring in. And it is on this leap of faith that we are going to have this second half recovery" in the economy, said Larry Wachtel, market analyst at Prudential Securities.

PeopleSoft climbed $2.71 to $17.82 after Oracle announced it was making a $5.1 billion, $16-a-share cash offer to purchase its rival business software maker. Oracle fell 27 cents to $13.09.

On Monday, PeopleSoft said it was buying another rival, J.D. Edwards & Co., in a stock swap then valued at $1.5 billion. .