Stocks on the Dow rise for the third day in a row, buoyed by falling jobless claims and better readings from leading indicators.
The Dow lost 200 points to close at 11766. Bank of America plunged 4 percent; other big banks also faltered.
Stock market falls sharply, with the Dow losing 162 points, after two big ratings agencies said the fiscal pact between European leaders would make little difference in solving the region's debt problems. Intel's lower fourth-quarter guidance dragged the stock market down further.
Tech stocks fell on news that chipmaker Intel, a bellwether for tech stocks, cut its profit outlook. Moody's says it plans to review EU sovereign debt ratings, adding to the general market gloom.
Euro deal would centralize oversight over European Union nations' budgets. The euro deal boosted the Dow 173 points in midday trading, but Britain is a holdout and euro agreements in the past have ultimately disappointed investors.
European Central Bank cuts interest rates but says it has no plan for large-scale purchases of European government bonds. Shares on Wall Street fall in early trading.
The Dow Jones industrial average dropped 0.61 of a point to close at 12,019.42 but ended the week up 7 percent, the largest weekly gain since July 2009.