Dow, S&P 500 dragged lower by Intel, IBM

A duo of tech snags sank the Dow and the S&P 500 Friday, but the Nasdaq hit a record closing high.

The Dow fell 179 points. The S&P 500 shed 11. But the Nasdaq eeked out a 12-point rally, capping the strongest week for the index in more than two months.

But that gain for the Nasdaq masked big drops for two struggling tech names.

IBM was a big loser after it missed sales estimates and posted the fourth consecutive drop in quarterly sales. That stock slumped 10 percent.

Intel was the other drag. The chip giant's incoming CEO seemed to back away from the company's previous to start outsourcing the production of some of its chips. The uncertainty overshadowed better-than-expected quarterly results. Intel tumbled 9 percent.

For some on Wall Street, the heavy selling seen in those two tech names added to belief that this market is due for a pullback.

Peter Cardillo, chief market economist, at Spartan Capital Securities is in that camp.

"It's just a matter of time before we see a pullback of maybe eight percent. This market is really stretched out. And, you know, so far the news has been good. In fact, the macro news has been improving. The earnings got off to a good season. And, of course, we'll be seeing and hearing more about earnings next week. There are over 700 companies reporting."

Some key names to report results in the coming week include tech bellwethers: Apple, Facebook and Microsoft.

Economic releases on Friday were mostly upbeat. U.S. factory activity surged in January to its highest level in nearly 14 years, according to a private survey.

And home re-sales ended last year with a bang. Full-year sales grew 22 percent from the year before, fueled by record-low mortgage rates and an exodus from urban centers.