New York – U.S. stocks closed flat Tuesday after an uneven session made skittish by a Federal Reserve official’s warning that the central bank may need to raise interest rates again to combat inflation.
Advanced Micro Devices proved a bright spot, rallying on an upbeat market-share forecast and a broker upgrade.
The Dow Jones industrial average closed down 5.21 points at 11,339.84. The Nasdaq Composite Index and the S&P 500 Index overcame early weakness to close up 2.27 points at 2,150.02 and up 1.30 point at 1,298.82, respectively.
Advancers outpaced decliners 19 to 13 on the New York Stock Exchange and 4 to 3 in the Nasdaq market. Volume was light with a little more than 1.2 billion shares traded on the NYSE and about 1.59 billion in the Nasdaq market.
Steve Goldman, chief market strategist at Weeden & Co., said investors late in the day overcame their initial nervous reaction to Chicago Fed President Michael Moskow’s warning that a pause in rate hikes this month may not mark the end to the tightening cycle.
“Initially, the Fed comments caused some hesitation,” Goldman said. “… But a lot of the pressure is being taken off the market by the lower (Treasury) yields that we’ve been seeing in the last few weeks.”
Iran was the other main focus of the market.
Iran’s chief nuclear negotiator, Ali Larijani, said his country is ready to begin “serious talks” with the U.S. and the five other Western powers that put together an incentive package designed to encourage it to end its nuclear activities. Larijani, however, did not make clear whether his country would abandon nuclear enrichment.
Crude-oil futures traded higher on the latest Iran developments. The benchmark September contract closed up 18 cents at $72.63 a barrel, marking its third winning session in a row.
