By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) — U.S. stocks retained a small edge Tuesday as German Chancellor Angela Merkel’s comments curbed enthusiasm that came after Spain successfully sold debt.
Stocks scaled back their gains after media reports that the German chancellor had turned down the idea of boosting the ceiling of the European Stability Mechanism, or the permanent rescue fund for the euro area. Analysts at Action Economics cited reports “that Germany’s Merkel has rejected raising the funding limits for the ESM bailout program.”
After climbing more than 120 points, the Dow Jones Industrial Average DJIA +0.42% was lately up 23.95 points at 12,045.34.
The S&P 500 Index SPX +0.25% advanced 1.46 points to 1,237.93, with energy gaining the most and consumer discretionary the greatest laggard among its 10 major industry groups. The Nasdaq Composite COMP -0.04% erased gains to fall 6.07 points to 2,606.19.
Advancers ran just ahead of decliners on the New York Stock Exchange, where 202 million shares traded by 11:05 a.m. Eastern.
European stocks had advanced after Spain sold 4.94 billion euros ($6.5 billion) in government debt, more than targeted, and investor confidence in Germany unexpectedly rose.
Analysts believe the Federal Reserve will probably not opt for added economic stimulus at a policy-setting meeting now under way. The Federal Open Market Committee’s statement on the economy and interest rates is expected at 2:15 p.m. Eastern.
Economic reports of late have largely illustrated expansion, albeit at a lackluster pace, with the jobless rate falling to 8.6% in November and holiday shopping off to a good start.
U.S. stock futures had maintained their gains ahead of the opening bell following government data that showed the nation’s retail sales climbing just 0.2% in November.
“While weaker than expected, the year-over-year gain is still 6.2% excluding gasoline-station sales,” Peter Boockvar, equity strategist at Miller Tabak, said in emailed commentary.
“The U.S. economy has hung in pretty well of late,” he added.
Other reports Tuesday on the U.S. economy had the Commerce Department reporting that inventories at U.S. businesses rose 0.8% in October, with business sales up 0.7%.
Separately, the Labor Department estimated job openings fell to 3.27 million in October from 3.38 million the month before.
Kate Gibson is a reporter for MarketWatch, based in New York.
