Stocks Hold Gains Despite Consumer Data

The Conference Board said the so-called Present Situation index fell to 29.4 from 42.3 a month prior, and the Expectations Index decreased to 43.8 from 46.2 in November. "Both sub-indexes bear careful watching over the next several months to see if they are starting to show signs of approaching a bottom," says Franco. "In the meantime, however, the overall economic outlook remains quite dismal for the first half of 2009, and only a modest recovery is expected in the second half."

Fallout from a lackluster holiday sales season continues to play out in the retail sector. The International Council of Shopping Centers said Tuesday that in the week ended Dec. 27, chain store sales fell -1.5% compared to a 2.6% gain the week prior. Meanwhile, Parent Co. (KIDS Quote), which operates etoys.com, is the latest victim to fall, filing for Chapter 11 bankruptcy protection this week.

The Standard & Poor's/Case-Shiller 20-city housing index fell by a record 18% in October year over year, while the 10-city index fell 19.1%. The 20-city drop was the largest since its inception in 2000.

In other commodities, oil was recently down 92 cents at $39.63, after rising above $40 a barrel a day prior on the possibility that Israeli attacks in Gaza could lead to restrictions in regional supply. Gold was recently down $3.10 at $872.20 an ounce.

Longer-dated U.S. Treasury securities were recently mixed. The 10-year note was flat to yield 2.1%, and the 30-year was recently rising 18/32, yielding 2.6%. The dollar was weaker against the euro, and stronger against the pound and yen.