NEW YORK - Stocks ended the next-to-last day of 2009 little changed as welcome news on manufacturing helped offset a drop in commodities prices.
The market drew support yesterday from a key economic indicator that signaled growth in Midwest manufacturing for a third straight month. The Chicago Purchasing Managers Index rose to 60 in December from 56.1 in November. The report found that production and new orders increased and employment improved.
A rising dollar and light volume held the market's gains in check. A rise in the dollar makes commodities, and thus the shares of companies that produce commodities, less attractive to foreign buyers. It also hurts the profits of companies that do business overseas.
Some investors have been buying the dollar in recent weeks on the belief that the economy is improving and the Federal Reserve will raise interest rates in the next year.
Rock-bottom interest rates have encouraged investors this year to move out of cash and into riskier assets such as stocks and commodities that have the potential to earn bigger returns. While a rise in interest rates would be a sign that the economy is on the right track, it could hurt the stock market's advance.
After a 24.7 percent rise in the benchmark Standard & Poor's 500 index this year, many investors have closed their books and are making few moves ahead of the start of 2010. Trading has been quiet, with fewer players in the market, though light volume can also bring volatility.
The Dow Jones industrial average ticked up 3.10, or 0.03 percent, to 10,548.51, its highest close since Oct. 1, 2008.
With one trading day left in the year, the Dow is up 61.12 percent from the 12-year low it reached in March, but it is still down 25.5 percent from its peak of 14,164.53 on Oct. 9, 2007.
The S&P 500 index edged up 0.23, or 0.02 percent, to 1,126.42, while the Nasdaq composite index rose 2.88, or 0.13 percent, to 2,291.28.
The modest moves came a day after stocks broke a six-day winning streak as reports on home prices and consumer confidence failed to rally investors.
The day brought reminders that companies are still hurting from the blows of the recession.
The government injected GMAC Financial Services with $3.8 billion in cash to help the financing company deal with losses in its home-mortgage business. The Treasury Department said the new aid was drawn from a taxpayer-financed bailout fund, but it is less than the roughly $6 billion the government had expected GMAC would require. GMAC has already received $12.5 billion in taxpayer money. The latest move boosts the federal government's ownership in GMAC to 56 percent from 35 percent.
Meanwhile, Aetna Inc. said it expected to book a fourth-quarter charge of up to $65 million to cover the costs of layoffs and consolidations. Shares of the health insurer fell 71 cents, or 2.16 percent, to $32.15.