Wall Street Shrugs Off Dismal Data

Updated from 12:47 p.m. EST

Stocks in New York continued to trade with gains Tuesday afternoon despite the release of the worst consumer confidence figures on record and as investors neared the close of a year that broke banks and portfolios alike.

Wall Street and Main Street are no doubt relieved to bid adieu to a traumatic 2008. "We've had a significant selloff; there are a lot of battered investors lying in the streets and we're seeing some last-minute repositioning as we finish up the year," says Alan Gayle, senior investment strategist at RidgeWorth Capital Management.

Putting a final stamp on the down year, the Conference board reported Tuesday that consumer confidence fell to a new all-time low in December, to 38 from 44.7 in November. "The further erosion of the Consumer Confidence Index reflects the rapid and steep deterioration of economic conditions that occurred in the fourth quarter of 2008," says Lynn Franco, director of the Conference Board Consumer Research Center.

The data aren't getting any better, but investors didn't expect them to, says Gayle. Indeed, in recent trading, the Dow Jones Industrial Average was up 110 points at 8594, and the S&P 500 was gaining 12 points at 881. The Nasdaq was adding 23 points at 1533.

The last five trading days of the year and the first five trading days of the new year typically have a positive tilt, and the market appears to be focusing more on the fall back in energy prices and year-end positioning than incremental news, says Gayle.