NEW YORK (CNNMoney.com) — Stocks ended higher Friday, marking the fourth straight day of gains, but investors were cautious buyers at the end of a big week that included the Fed’s decision to boost the emergency bank lending rate.

The Dow Jones industrial average (INDU) added 9 points, or 0.1%. The 30-share blue chip index gained 303 points for the week, its biggest one-week point gain since November.

The S&P 500 index (SPX) edged up 2 points, or 0.2%. The Nasdaq composite (COMP) gained 2 points, or 0.1%.

U.S. stock futures had tumbled overnight on the Fed news, pushing stocks lower at the open, which had been expected. But the knee-jerk reaction gave way to a more measured take as Friday’s session wore on, since it won’t impact borrowing costs for consumers or businesses.

“This wasn’t unexpected, we know the medicine can’t stay in the system forever,” said Rob Lutts, chief investment officer at Cabot Money Management. “But this is just a first step, one that’s symbolic but not hugely meaningful.”

He said that the move doesn’t mean the Fed plans to raise the more influential fed funds rate anytime soon.

Stocks have been on the rise lately, with the Dow, Nasdaq and S&P 500 gaining during all four sessions in a holiday-shortened trading week. The major gauges ended higher for the second week in a row after a four-week rout driven by worries about slowing growth in China and Greece’s debt problems spreading to the rest of the euro zone.

In that month-long decline, the S&P 500 lost 9.2%, coming close to the technical definition of a correction.

Fed: The central bank said late Wednesday that it is raising the discount rate, the rate it charges banks seeking emergency loans, by a quarter-percentage point, to 0.75%.

The bank said the change reflects improvements in the economy and not a move toward tighter policy. Fed chairman Ben Bernanke had indicated that a move was coming last week. However, such changes typically don’t occur between Fed meetings and the timing of the move surprised markets.

The move doesn’t have much impact on banks on a day-to-day basis and won’t hike consumer or corporate borrowing costs. The more widely used fed funds rate, the overnight rate banks charge each other, is expected to remain at historic lows near zero for the foreseeable future.

“I think the market realizes that this is not a watershed event,” said John Canally, economist at LPL. “It’s another step in the process toward removing all the emergency measures put in place during the crisis.”

However, the move seemed to unsettle the forward-looking markets, and several Fed officials sought to calm any jitters, including St. Louis Federal Reserve Bank President James Bullard.

Bullard, who is a voting member of the Fed’s policy setting committee, said that worries about a rise in the fed funds rate this year are overblown. Atlanta Fed president Dennis Lockhart said the action should not be interpreted as a tightening of monetary policy or a sign that it is imminent, but rather a “normalization step.”

The move was the first time the Fed lifted any of its lending rates since the financial crisis first hit in 2007. It was the first time there was any change at all in rates since December of 2008.

World Markets: Asian markets tumbled overnight on worries about the Fed, but European markets managed to erase losses and turn higher by the close.

Inflation: The government’s reading on consumer inflation showed pricing pressure remains minimal. The Consumer Price Index (CPI), rose 0.2% in January after rising 0.2% in December. Economists surveyed by Briefing.com thought it would rise 0.3%.

The so-called core CPI, which strips out volatile food and energy prices, fell 0.1% after rising 0.1% in December. Economists thought it would rise 0.1%.

Dell: After the close Thursday, Dell (DELL, Fortune 500) reported weaker quarterly earnings and higher revenue, both of which beat analysts’ estimates. But investors took a sell the news approach, sending shares lower Friday.

The dollar and commodities: The dollar fell versus the euro and the yen, erasing morning gains.

U.S. light crude oil for March delivery rose 75 cents to settle at $79.81 a barrel on the New York Mercantile Exchange.

COMEX gold for April delivery rose $3.30 to settle at $1122 per ounce.

Bonds: Treasury prices rose, lowering the yield on the 10-year note to 3.77% from 3.80% late Thursday. Treasury prices and yields move in opposite directions.

Market breadth was positive. On the New York Stock Exchange, winners beat losers by nearly three to two. On the Nasdaq, advancers topped decliners by a narrow margin on volume of 2.14 billion shares.

Via: