NEW YORK — Even the prospect of interest rates staying low couldn’t keep buyers in the stock market.
Stocks ended little changed Monday, having given back a brief afternoon gain that followed comments from Federal Reserve Chairman Ben Bernanke. The Fed chief said unemployment and other problems would hold the economy to “moderate” improvements and that rates are likely to remain low.
Bernanke’s remarks sent the dollar down because low rates make a currency less attractive, and that gave stocks a boost because a lower dollar can add to profits for U.S. companies that do business overseas. The market’s gains evaporated later, however, as the dollar pared its losses.
Dan Deming, a trader with Stutland Equities, said there were simply too few buyers on a day with little new news to keep the momentum going.
“It just feels like it’s drifting,” he said. “The market feels tired.”
The fatigue comes as traders find few answers to questions about what investments will be strong in 2010 following the big run in stocks and commodities this year. Many investors have closed their books on the year and are wondering whether incremental improvements in the economy will be able to support more stock market gains next year.
The Dow Jones industrial average rose 1.21, or less than 0.1 percent, to 10,390.11 after being up 54 points and down 29 points.
On Friday, the Dow ended with a gain of 23 points after having been up as much as 151 points following the unemployment report.
The broader Standard & Poor’s 500 index fell 2.73, or 0.3 percent, to 1,103.25. It’s up 22.1 percent for the year. The Nasdaq composite index fell 4.74, or 0.2 percent, to 2,189.61.
The day’s back-and-forth trading followed a brief spike Friday, when a strong jobs report for November provided one of the best signs yet that the economy is recovering.
Some analysts say the market overreacted Friday in predicting that interest rates were due to rise following a marginal drop in unemployment.
“We have a slowly recovering economy,” said Robert MacIntosh, chief economist at Eaton Vance Management. “I don’t think you need to worry about the Fed changing their mind and raising rates anytime soon.”
