NEW YORK (TheStreet) -- Stocks recovered from session lows by midafternoon Tuesday, though the energy sector weighed on the major indexes because of plummeting oil prices.
Oil prices plunged ahead of a meeting of the Organization of the Petroleum Exporting Countries in Vienna on Thursday. OPEC will determine whether to cut production to address a supply glut and prices that have been in freefall. Individual meetings between Saudi Arabia, Venezuela, Mexico and Russia have failed to come to any solution. West Texas Intermediate crude was down 2% to $74.24 a barrel on Tuesday.
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The S&P 500 added 0.03%, the Dow Jones Industrial Average climbed 0.14%, and the Nasdaq was up 0.13%.
Shares were lower earlier in Tuesday's session as third-quarter GDP triggered fears that an economic recovery further along than expected could mean a return to normal monetary policy for the Federal Reserve sooner than forecast. Third-quarter GDP was upwardly revised to 3.9% from an initial reading of 3.5%, topping even the most generous estimates. Economists surveyed by Bloomberg predicted a range of 3% to 3.8% with a consensus of 3.3%.
"If the economy is growing, then the Fed's medicine worked," Eric Marshall, portfolio manager for Hodges Mutual Funds. "We've had an unprecedented period of extremely low interest rates that have been in response to soft economic conditions and a high unemployment rate over the last few years."
However, this might not be what investors want to hear given that a better economy could trigger the Fed to raise interest rates sooner than expected. "Good news on GDP was actually negative for equity investors," Chris Gaffney, senior vice president at Everbank, said in a call. "Stronger U.S. economy worries investors in that they believe that interest rates will start rising sooner."
The economy wasn't showing across-the-board strength, however, after consumer confidence unexpectedly declined and housing price growth continued to decelerate. November consumer confidence fell to 88.7, down from 94.1 in October and far lower than economists' forecasts for an increase to 96. Hopes were high that recent declines in oil prices would fuel increased consumer spending.
"While the dip in confidence is hardly a nail in the coffin for the protracted equity market rally, it does mesh with more granular initial claims data of late, which has drifted higher," wrote Interactive Brokers' chief market analyst Andrew Wilkinson in a note.
Growth in home prices softened again in September, rising 4.9% across 20 metropolitan areas from 5.6% a month earlier, according to the S&P/Case-Shiller composite index. The result came in slightly better than an expected 4.7% increase.
Netflix (NFLX) was 1.8% lower on a downgrade to "hold" from Stifel analyst Scott Devitt. "We ... view shares as more attractive in the low-$300 range until we gain more clarity on domestic subscriber growth trajectory," Devitt wrote in a report.
Spain-based bank Santander (SAN) was gaining 1.3% after naming its former chief financial officer to the vacated role of CEO. Former chief Javier Marin had held the position for less than two years.
-- Written by Keris Alison Lahiff in New York.