By Michael Wursthorn and Riva Gold 
   -- Dow, S&P 500 slightly higher 
 
   -- Lira lurches lower 
 
   -- European shares fall 

The Dow Jones Industrial Average edged higher Friday, as fears of contagion from Turkey's currency crisis continued to ebb.

The index of the 30 U.S. stock-market stalwarts added to its massive gains from Thursday when the Dow logged its biggest point move in four months, easing investor concerns that the U.S. market was on the cusp of a more significant pullback. An additional week of solid corporate profit reports from companies like Walmart helped.

Turkey's mounting woes have pressured the market this week and contributed to a punishing run of trading sessions for investors who worried that the threat of additional sanctions could deepen the country's economic funk and spill over into other markets.

But even though Turkey's lira took another step lower Friday after the Trump administration threatened to impose additional penalties over the country's imprisonment of a U.S. pastor, investors marked down the risk of seeing a significant, damaging ripple into the U.S. stock market.

"Turkey's issues are unique and we really don't see a single factor that creates a contagion risk," said Janet Johnston, a portfolio manager with Trimtabs Asset Management.

The Dow industrials climbed 50 points, or about 0.2%, to 25609 in recent trading, while the S&P 500 added less than 0.1%. The Nasdaq Composite slumped 0.3%.

The additional gains helped put the Dow and S&P 500 solidly on pace toward a second consecutive week of gains. The Nasdaq, however, is down 0.7% over the past five trading days, as tech stocks came under pressure earlier in the week.

On Friday, consumer-staple stocks led the broad S&P 500 higher. The sector of food makers and household-product manufacturers has been enjoying a renaissance lately, as investors have sought the relative safety of consumer-staple stocks to hedge against the market volatility that has been playing out. Consumer staples tend to pay generous dividends and fare better during periods of economic duress since consumers tend to always need those goods and products.

Coca-Cola rose 0.9% in recent trading, while Walgreens Boots Alliance added 1.1%. Both are Dow components, with Walgreens recently replacing General Electric in the index, as well as consumer-staple stocks.

Declines among shares of tech and consumer-discretionary stocks ate into those gains and extended weekly losses for both sectors.

While investors have marked down Turkey's risk to the U.S., Europe and emerging-market countries remain exposed, analysts said.

European banks have a greater exposure to Turkish debt compared with U.S. lenders, Rebecca Patterson, chief investment officer at Bessemer Trust, wrote in a recent report. And Turkey's overall weakness could raise fresh questions about the strength of emerging-market countries' economies, Ms. Patterson added.

Several big money managers in recent days have reiterated their "underweight" stances toward emerging-market stocks, which were already trailing developed markets this year.

In Europe, the Stoxx Europe 600 fell 0.1% Friday to extend its decline for the week to 1.2%, its biggest weekly decline since June.

Stocks in Asia, meanwhile, were mixed.

Hong Kong's Hang Seng edged up 0.4% Friday, snapping a five-day losing streak as index heavyweight Tencent Holdings rebounded from a large setback that followed downbeat earnings results.

The Shanghai Composite fell 1.3%, ending the week down 4.5% to touch its lowest closing value since January 2016.

Even with the focus on Turkey, investors continue to follow trade talks between the U.S. and China since officials from both countries reached a deal to hold lower-level talks later this month. Any significant developments that appear to deepen the cross-continental spat could dash earnings later this year and weigh on the stock market, investors said.

"With trade, we have to be a little more circumspect because we have the potential for a tit-for-tat race to the bottom that could have significant ramifications for earnings," said David Vickers, senior portfolio Manager at Russell Investments.

Write to Michael Wursthorn at Michael.Wursthorn@wsj.com and Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

August 17, 2018 14:07 ET (18:07 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.