Stocks fluctuated in a narrow range Tuesday after reports on home prices and consumer confidence came in largely as expected, showing a gradual improvement in the economy.
Major indexes had risen modestly in the early going, but were mixed in afternoon trading as the dollar strengthened and tugged on commodities prices. A stronger dollar makes commodities more expensive for foreign buyers. Energy and material stocks fell in response to the drop in commodities.
Trading was quiet, as it has been in recent days. Many investors were taking vacation between Christmas and New Year's Day. Even in light volume though, the market has managed to climb. The Standard & Poor's 500 index has posted gains for six straight days, rising 2.3 percent to reach a new high for the year.
Earlier Tuesday, the Conference Board said its index of consumer confidence rose to 52.9 in December from 49.5 in November. That was slightly better than the reading of 52 economists had forecast.
The index is still a long way from what is considered healthy. A reading of 90 or more signals a solid economy. However, the index has risen significantly from a historic low of 25.3 in February.
A report on home prices also showed a slight improvement. The Standard & Poor's/Case-Shiller's home price index rose for a fifth straight month in October, edging up 0.4 percent. The index was off 7.3 percent from October last year, roughly in line with expectations.
Analysts said there were few surprises in the economic data to drive the market one way or the other.
"The reports we're seeing broadly reinforce the expectations we've had," said Jim
Baird, partner and chief investment strategist for Plante Moran Financial Advisors in Kalamazoo, Mich. "It's slow and steady; It's not explosive improvement."
In late afternoon trading, the Dow Jones industrial average rose 12.09, or 0.1 percent, to 10,559.17. The S&P 500 index slipped 0.51, or 0.1 percent, to 1,127.27, while the Nasdaq composite index fell 1.67, or 0.1 percent, to 2,289.41.
Interest rates fell after a successful auction of $42 billion of five-year notes. The Treasury Department is issuing a total of $118 billion of debt this week as part of its ongoing efforts to fund its stimulus programs. With so much debt flooding the market, there's been concern this year that demand would diminish. Most auctions though have been able to attract decent demand.
The yield on the 10-year Treasury note, which is used as a benchmark for consumer loans, fell to 3.81 percent from 3.85 percent late Monday.
The dollar reversed an early slide and moved higher against other currencies. Oil prices fluctuated, hovering around $79 a barrel on the New York Mercantile Exchange. Gold prices fell.
Reports showing an increase in durable goods orders and a drop in claims for unemployment benefits helped spur the market higher last week. On Monday, investors were encouraged by a jump in retail sales.
Tim Speiss, chairman of Personal Wealth Advisors practice at Eisner LLP in New York, said he expects to see the market build on its recent gains at the start of the new year and through the first quarter.
"We're going to be building momentum," he said.
Falling stocks narrowly outpaced those that rose on the
New York Stock Exchange, where volume came to a low 406.5 million shares.
In other trading, the Russell 2000 index of smaller companies fell 0.97, or 0.2 percent, to 632.78.
Overseas, Britain's FTSE 100 rose 0.7 percent, Germany's DAX index added 0.1 percent, and France's CAC-40 rose 0.3 percent. Japan's Nikkei stock average inched up less than 0.1 percent.
