A two-stage iterative Fourier transform algorithm, based on hybrid input-output algorithm and new Pnoise algorithm, is used to design continuous and quantized phase-only diffractive pattern elements which produce arbitrary given intensity patterns via Fraunhofer diffraction. Numerical results for two $128 imes128$ binary patterns and two grayscale patterns are compared with those of other algorithms. It is found that the algorithm yields better signal-to-noise ratio and even better uniformity with slightly lower diffraction efficiency than other algorithms. We investigated the dependence of performance on parameters used in the algorithm, size of noise region, and the number of phase levels for quantized elements. In the case of quantized phase elements, the size of noise region plays a greater role in determining the performance of the algorithm than given intensity pattern itself. tself.