Housing Data Hem In Stocks

Updated from 4:14 p.m. EST

Stocks were volatile in a low-volume session Friday and ultimately closed flat as weak housing data ran up against positive headlines out of the financial sector.

After spending time in both positive and negative territory, the Dow Jones Industrial Average rose 6.26 points, or 0.05%, to 13,365.87. The S&P 500 tacked on 2.12 points, or 0.14%, to 1478.49, and the Nasdaq Composite slipped 2.33 points, or 0.09%, to 2674.46, pressured by a loss of 2.5% in Sirius Satellite Radio (SIRI Quote - Cramer on SIRI - Stock Picks).

The major averages saw early gains evaporate and went under water following a miserable read on new home sales for November. The Census Bureau said that sales plummeted 9% last month to 647,000 annualized units. Making things worse was news that new-homes inventory rose to 9.3 months.

Following the report, the Philadelphia Housing Sector Index dropped 1.1%.

"There is no end in sight as far as housing is concerned," said Robert Pavlik, chief investment officer with Oaktree Asset Management. "It's going to continue to be a drag on the economy, so this number isn't so surprising. We need to see housing prices continue to decline in order to eliminate inventories."

Volume on the New York Stock Exchange hit 2.36 billion shares, with advancers matching decliners. On the Nasdaq, volume touched 1.31 billion shares, and losers edged winners 8 to 7.

With only one day of trading remaining for 2007, many market participants are hoping the major averages will end the year on an upbeat note. Thus far, the Dow is up 7.2%, and the S&P 500 has added 4%. The Nasdaq has been the best performer, rising 10.8%.

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