* Retail sales top view, consumer sentiment worsens
* Nvidia turns lower, Dillard's drops after results
* Indexes up: Dow 1 pct, S&P 0.5 pct, Nasdaq 0.8 pct
* For up-to-the-minute market news see [STXNEWS/US] (Updates to afternoon, changes byline)
By Rodrigo Campos
NEW YORK, Aug 12 (Reuters) - U.S. stocks rose on Friday as mildly encouraging retail sales overshadowed weak consumer sentiment data, with lighter volume reflecting a drop in investor anxiety.
Still, the market was down for the week and on track for its worst three-week decline since March of 2009, when it hit 12-year lows.
Trading remained volatile, with stocks retreating after the sentiment reading early in the session, then rebounding by midday.
With less than two hours of trading left, composite volume was about 6 billion shares, far below the daily average of approximately 16 billion shares traded this week.
"Today's slowdown in volume is clearly indicative of people getting a little bit more comfortable about where the market is," said Ken Polcari, managing director at ICAP Equities in New York. "It continues to be a little bit jumpy, but (the S&P is) holding between 1,117 and 1,170."
He said if next week's economic data meet expectations, the current trading range could continue.
"Before moving higher the market needs to do some repair work and needs to build a base, and that's what we're doing right now," Polcari said.
The Dow Jones industrial average <.DJI> added 112.31 points, or 1.01 percent, to 11,255.62. The Standard & Poor's 500 Index <.SPX> gained 5.76 points, or 0.49 percent, to 1,178.40. The Nasdaq Composite Index <.IXIC> rose 19.73 points, or 0.79 percent, to 2,512.41.
Indexes are set to record their third straight negative week. The S&P 500 has fallen for 11 of the past 15 days.
U.S. markets got support from a 3.6 percent rise in European shares <.FTEU3>. Regional stocks were helped by a short-selling ban on financial shares by France, Italy, Spain and Belgium that eased fears over recent sharp declines. [.EU]
U.S. consumer sentiment fell to its lowest level since 1980, but retail sales posted their biggest gain in three months in July, two reports showed. For details, see [ID:nN1E77B0LP]
Among individual stocks, Nvidia Corp
Dillard's Inc
Advancers beat decliners on the New York Stock Exchange by about 12-to-five, while the ratio on the Nasdaq was about seven-to-five. (Editing by Jeffrey Benkoe)