Stocks seesaw, inch higher as 'cliff' uncertainty persists
NEW YORK — The stock market ended higher Thursday upon flipping between small gains and losses throughout the morning. Uncertainty about the “fiscal cliff,” just days away, was at the forefront for many traders.
The Dow Jones industrial average fell as much as 36 points before ending the day higher, rising 59.75 points to close at 13,311.72. Other indexes followed similar patterns. The Standard & Poor's 500 rose 7.88 to 1,443.69. The Nasdaq composite index rose 6.02 to 3,050.39.
In Washington, the Republicans offered in their “Plan B” to raise taxes on the wealthy, but Democrats complained that it would not address the steep budget cuts that are automatically set to occur for military and domestic agencies.
If the Republicans and Democrats don't work out a compromise before the end of the month, the United States could go over the “cliff,” a reference to big tax increases and government spending cuts that would automatically kick in if no budget deal is in place.
But a successful compromise is no guarantee that the market will soar. The market assumes that a budget compromise will be reached, Fischer and others said, evidenced by its more-or-less steady increase since mid-November.
Also at the forefront for many traders was the news that NYSE Euronext, the parent of the New York Stock Exchange, planned to sell itself to IntercontinentalExchange, an upstart and lesser-known exchange operator based in Atlanta.
NYSE Euronext's stock surged $8.20 to $32.25.
The boost at IntercontinentalExchange was much more modest, with the stock rising $1.79, or just more than 1 percent, to $130.10. That signals traders think the proposed deal could be more beneficial to NYSE Euronext than to its potential buyer.
Even without the complications of the budget negotiations, the economy has been difficult to read, a pattern that continued Thursday.
The government said the economy grew at an annual rate of 3.1 percent over the summer, higher than the previous estimate of 2.7 percent. But growth is likely to slow in the current quarter and early next year.
The government also reported that the number of Americans applying for unemployment benefits rose last week, a disappointment after four straight weeks of declines. The four-week moving average of jobless claims, a less volatile measurement, fell.
The yield on the 10-year Treasury note was unchanged at 1.80 percent. World markets were also mixed. Major stock indexes in Britain and Japan edged lower, while France and China rose.