NEW YORK (TheStreet) -- The major U.S. equity averages finished mixed Tuesday as a stronger-than-expected rebound in retail sales in July failed to fuel substantial buying.

Trading was positive for most of the low-volume session with investors also enjoying a measure of relief after the latest eurozone gross domestic product data contained no ugly surprises. But the view that the improved U.S. economic data of late lowers the chance that the Federal Reserve will eventually provide additional monetary stimulus dampened sentiment as the day wore on, as did another weak reading on small-business optimism.

The Dow Jones Industrial Average closed up nearly 3 points, or 0.02%, at 13,172, The blue-chip index stuck within a roughly 80-point range on the day, and is up 8% so far in 2012.

Breadth was negative within the Dow with 17 of the index's 30 components moving lower. The biggest percentage decliners were Alcoa ( AA), Cisco ( CSCO), and Hewlett-Packard ( HPQ).

Cisco shares lost 1% with the company's fiscal fourth-quarter report looming after Wednesday's closing bell.

Among the biggest blue-chip gainers were Bank of America ( BAC), Home Depot ( HD), Pfizer ( PFE), and Wal-Mart Stores ( WMT).

Home Depot's stock rose 3.6% after the home improvement products retailer reported a 13% increase in second-quarter net income and raised its full-year earnings outlook.

The S&P 500 dipped less than a point, finishing essentially flat at 1404. The Nasdaq slipped more than 5 points, or 0.18%, to close at 3017.

The weakest sectors in the broad market were basic materials, capital goods and consumer cyclicals and technology. The health care, services and consumer non-cyclical sectors were finding buyers.

Volume totaled 2.92 billion on the New York Stock Exchange and 1.57 billion on the Nasdaq. Winners ran roughly even with losers on the Big Board while decliners outpaced gainers by a 1.5-to-1 ratio on the Nasdaq.

Earlier in the day, Wall Street cheered after the Commerce Department reported retail sales rose a better-than-expected 0.8% in July after falling by a downwardly revised 0.7% in June. The gain was the largest since February. Economists surveyed by Reuters were looking for a 0.3% increase.

Excluding automobile sales, retail sales rose 0.8% in July after being down 0.8% in June.

Also, the Labor Department said the producer price index rose 0.3% in July after a 0.1% increase in June. The PPI was predicted to have risen 0.2%. Excluding the food and energy components, the PPI was up 0.4% in July after being up 0.2% in June.

"While both were firmer than expected, it's retail sales that takes center stage with widespread gains only partially offset by further downward revisions in the prior month," said David Ader, a strategist at CRT Capital Group.

"Combined with the solid payroll report for June, today's retail sales data further reduces the likelihood of QE3 in September but does not take it off the table, in our view," said Michelle Meyer, senior U.S. economist at Bank of America.

The Commerce Department also said business inventories ticked up 0.1% in June -- compared with the expected gain of 0.2%, after rising by 0.3% in May -- as U.S. companies opted to keep their stockpiles lean amid sluggish sales in the period.

A sequential slip in the National Federation of Independent Business's small business optimism index for July kept enthusiasm in check as respondents expressed concerns about earnings and a disheartening business inventories report.

September crude oil futures settled up 70 cents at $93.43 a barrel and December gold futures settled down $10.20 at $1602.40 an ounce.

The benchmark 10-year Treasury was diving 20/32, raising the yield to 1.735%. The greenback was up 0.14%, according to the dollar index.

The FTSE in London closed up 0.56% and the DAX in Germany settled up 0.94% after data showed that Germany's economy grew by 0.3% in the second quarter, better than the 0.2% rise that economists had expected. France's economy didn't grow in the second quarter, but that was still better than the expected 0.1% contraction.

In aggregate, eurozone gross domestic product shrank by 0.2% in the second quarter, in line with the consensus forecast.

The Hong Kong Hang Seng index settled ahead by 1.05% and the Nikkei in Japan closed up 0.50%.

In corporate news, Michael Kors ( KORS) shares jumped nearly 17% after the apparel company posted stronger-than-anticipated quarterly profit and hiked its full-year profit projection.

Estee Lauder Companies ( EL) was one of the biggest gainers on the S&P 500, surging more than 9% after the beauty products company beat quarterly profit estimates.

Dicks Sporting Goods ( DKS) shares were shed 4% after the company posted quarterly revenue that was in line with estimates and earnings that declined to $53.7 million in the second quarter from $73.8 million a year ago. Adjusted earnings came in just a penny above the Wall Street target.

Shares of Google ( GOOG) continued to gain ground following Monday's news of the company's agreement to acquire the Frommer's travel-guide business from John Wiley & Sons ( JWB) for a reported $25 million. The stock gained 1.3%.

Groupon ( GRPN), the daily deals site, beat analysts' quarterly estimates on the bottom line but revenue came in light. The stock tanked 27%.


-- Written by Andrea Tse in New York.

>To contact the writer of this article, click here: Andrea Tse.

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