December 21, 2010, TheStreet.com
Stocks closed mixed on Monday, showing signs of running out of steam after recent gains in the first session of a holiday-shortened trading week.
The Dow Jones Industrial Average traded in a narrow range of roughly 80 points, closing down by 14 points, or 0.1%, at 11,478. The benchmark index began the day on a positive note, hitting its session-high of 11,517 shortly after the open, but then dipped as low as 11,442 as trading wore on. The Dow is up about 10% year-to-date, with more than 4% of that gain coming in December alone.
The S&P 500 closed 3 points higher, or 0.3%, at 1,247, while the Nasdaq Composite added 7 points, or 0.3%, to finish at 2,650.
On Friday President Barack Obama signed the $858 billion tax bill into law, extending tax cuts enacted under the Bush administration for two years and jobless benefits for millions of Americans through 2011. The bill is expected to stimulate jobs and consumer spending, with economists already upping growth estimates for 2011.
But optimism about the bill faded quickly Monday amid fresh concerns about the escalating Korean conflict after South Korea test-fired artillery despite threats of retaliation from North Korea.
The February gold contract jumped $5.20 at $1384.4 an ounce, rising for a second consecutive session on its safe-haven appeal, though a stronger dollar was capping gains.
Alcoa(AA), 3M(MMM) and JPMorgan Chase(JPM) led percentage gains among the blue chips, while American Express(AXP), Boeing(BA) and Wal-Mart(WMT) were the Dow’s leading laggards.
Stocks in the energy, services, homebuilder and conglomerates sectors attracted buyers while transportation, technology, health care and financial stocks were under pressure. Volume on the New York Stock Exchange settled at around 830 million while roughly 1.71 billion shares changing hands on the Nasdaq. Breadth finished slightly negative on both exchanges with decliners outnumbering advancers 1,534 to 1,482 on the Big Board and 1,383 to 1,273 on the Nasdaq.
"The market is just giving back some gains after we had quadruple witching on Friday," said Marc Pado of Cantor Fitzgerald of the action earlier in the session, referring to the simultaneous expiration of contracts for stock index futures, stock index options, stock options and single stock futures. "And now we have the North Korea conflict," he added.
Members of the European Union failed to expand the current bailout fund at a summit last weekend. The members also did not agree to establish common-area eurobonds that will allow all 16 eurozone members to issue bonds under one umbrella.