NEW YORK - Wall Street put together a moderate advance in light post-Christmas trading yesterday after the government threw a lifeline to General Motors Corp.'s financing arm. But gains were limited by dreary holiday shopping readings that dimmed the chance of a big year-end market rally.
The major indexes finished the week with losses, but the market nonetheless showed further signs of stability.
The news from the retailing sector was far from surprising: Americans spent much less on gifts this holiday season than they did last year, according to SpendingPulse, a division of MasterCard Advisors. Retail sales dropped between 5.5 percent and 8 percent compared with last year, the data showed, or between 2 percent and 4 percent after stripping out auto and gas sales.
There was little conviction behind yesterday's advance on Wall Street, which the market managed after stocks had meandered for much of the session. With just three trading days left in the year, no news has been upbeat enough to spark a big year-end rally - a consequence of the great uncertainty still in the market. December is usually a strong month for stocks, and a flurry of trading known as a "Santa Claus rally" is often seen in the final week.
"I think we could have a year-end rally, but it's got a formidable headwind in the form of tax-selling, in my view," said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors L.L.C. He was referring to investors who sell their poorly performing stocks to realize a loss for the year, which can reduce their taxes later.
The Dow Jones industrial average rose 47.07, or 0.56 percent, to 8,515.55.