By TIM PARADIS AP Business Writer
NEW YORK Oct 24, 2006 (AP)— Wall Street wobbled through a listless session and closed mixed Tuesday as investors awaited the results of this week's Federal Reserve meeting. Modest gains in the Dow Jones industrial average were enough for the index to set new trading and closing records.
The Fed's Open Market Committee began a two-day meeting Tuesday, and while many investors expected the central bank's policymakers to leave interest rates unchanged for the third straight meeting, there was still concern on the Street about the assessment of the economy to be issued Wednesday afternoon.
Wall Street's performance was in contrast to a big rally Monday, when the Dow surged 114 points to a record high close and other indexes posted big gains.
Steve Sachs, director of trading at Rydex Investments, contends that the run-up this month in the Dow and blue chip stocks in general has occurred too quickly to avoid a pullback. "There's probably good reason for the rally to at least pause here."
The Dow rose 10.97, or 0.09 percent, to 12,127.88, eclipsing the record close of 12,116.91 set Monday. The Dow also set a new trading high of 12,133.80, edging past a day-old record of 12,125.16 before giving back some of its gains.
Broader stock indicators ended the day mixed after spending much of the session lower. The Standard & Poor's 500 index was up 0.36, or 0.03 percent, at 1,377.38, and the Nasdaq composite index was down 10.72, or 0.45 percent, at 2,344.84.
Bonds rose slightly as investors awaited the Fed's decision. The yield on the benchmark 10-year Treasury note fell to 4.82 percent from 4.83 percent late Monday. The dollar was mixed against other major currencies, while gold prices rose.
Light, sweet crude settled up 54 cents at $59.35 a barrel on the New York Mercantile Exchange. Falling oil prices, which fell to lows for the year last week, have helped drive stocks higher in the last several months.
Sachs expects investors will stop and catch their breath as earnings season winds down and Wall Street receives economic news from the Fed and an advance reading of third-quarter's gross domestic product. The Commerce Department report on the broadest measure of the economy is due Friday. Sachs also contends that the rise in the major indexes has at times occurred with too few stocks driving the advances.