Stocks End Near Flat Line on Thin Volume (AAPL, BAC, CVX, GPS, IGT, INTC. MJN, SHLD, TSO, WYNN, XEL, XLU)

Published on Tuesday, 27 December 2011 18:07 Written by Christopher Lynn

New York, December 27^th (TradersHuddle.com) – Stocks ended narrowly mixed in a thinly traded lackluster session. The broad market and the blue chip indexes closed near the flat line. The U.S. economic data was mixed, while European jitters continued ahead of a year-end debt auction in Italy.

The Dow Jones Industrial Average fell 2.65 points, or 0.02%. The S&P 500 index gained less than 1 point, or .01%, while the NASDAQ climbed 6.56 points, or 0.25%

The market started with slight losses, following a quiet start from the long Christmas weekend, which yielded lackluster and mixed sessions in overseas markets. The reading of the S&P Case Shiller 20 city Housing price Index showed a declined of 3.4% year over year, slight better than the prior month, but worse than expected.

In Europe, equity markets closed mixed on very thin volume as many participants remain on holiday following the Christmas Weekend. Despite the thin volume jitters surrounding a pending Italian bond auction later in the week pushed bond yields higher, weighing heavily on Italian banks.

Stocks were able to hold to gains and close near the session highs, with all of the 30 Dow components finishing higher and all of the S&P 500 key sectors ending with sharp gains. Energy, materials, financials, and industrials jumped more than 3%. Consumer staples and utilities underperformed, but still closed with gains of more than 2%.

In the S&P 500 Select Sectors, utilities, consumer discretionary, and energy posted the biggest gains, while financials, industrials, and materials fell. The Utilities Sector SPDR (NYSE:XLU) gained 0.8%, as participants embraced the defensive sector on a day with housing prices falling more than expected, while consumer confidence figures were better than expected. Xcel Energy (NYSE:XEL) was the best performer in the sector, with shares climbing 1.54% to $27.62, after logging a new 52-week high at $27.70.

Consumer discretionary stocks were also amid the outperformers for the session, particularly helped by the upside move on gaming related stocks. International Game Technology (NYSE:IGT), the maker of casino gaming computerized systems, jumped to the top of the sector, with a 4.95% gain to $17.37. The Department of Justice reversed on previous policy that included civil and criminal charges against operators of some of the most popular online poker sites. The decision, which was made public last Friday clears the way for individual states to legalize online Poker and other online betting that can help them generate billions in tax revenue and spur web-based gambling.

Wynn Resorts (NASDAQ:WYNN), the luxury casino operator, also benefited in the session, with shares jumping 3.21% to $113.53. Last week, the stock closed above calculated resistance at $108.65. Wynn has climbed 9.3% year to date.

Also to the upside in the sector were shares of The Gap (NYSE:GPS). The owner and operator of specialty retailers like Banana Republic and Old Navy, climbed 2.42% to $19.06 on the back of the consumer confidence figures and an Barron’s article over the weekend, stating the potential for a rebound in the company’s business.

On the flip side, Sears Holdings (NASDAQ:SHLD) plunged to the bottom of the S&P 500 and the NASDAQ-100 following a negative update on same store sales and the announcement that it will close 100 to 120 Sears and Kmart stores. The stock got hammered; tumbling 27.2% to $33.38, posting a new multiyear low at $33.26 after the company said that said that quarterly comparable stores sales fell 5.2%, while yearly comparable store sales declined 2.6%. According to the data, Sears Domestic saw the sharpest declines, as the company was seeing a difficult economic environment for big-ticket items.

Energy received a lift from higher crude oil prices, which closed above $100 per barrel for the first time in 2 weeks, as the fuel received a bump from an Iranian threat to block the flow of crude through the straight of Hormuz and on a weaker greenback. Tesoro (NYSE:TSO), the crude oil refiner based in San Antonio Texas, gained 2.16% to $24.09, posting the biggest gain in the sector, while Chevron (NYSE:CVX) gained 0.4%, posting one of the top advances in the Dow Jones Industrial Average.

Financials were under pressure; following euro zone jitters ahead of a key Italian bond auction late dint the week. Bank of America (NYSE:BAC), the largest U.S. lender, tumbled more than 2% to $5.48, giving back some of its sharp gains from last week. A Reuters report speculating that the Charlotte, NC based lender was contemplating selling more assets to shore up capital weighed on the sector.

And after trading as high as $409.09, Apple (NASDAQ:AAPL), the maker of iPads and iPhones, helped the tech sector, as shares climbed 0.8% to $406.53. Last week Susquehanna reiterated its Positive rating for Apple, saying that strong holiday sales of the company's iPad tablets as well as new product launches such as the iPhone 5 and iPad 3 will be significant positive catalysts to the stock, while Barclays said that a potential dividend, the release of the iPad 3, the iPhone 5, and a possible Apple TV could be the key catalysts for the stock in 2012.

Also in the sector, Intel (NASDAQ:INTC), the world’s largest chipmaker, gained 0.66% to $24.56, posting the biggest gain in the blue chip index. Year to date, the stock is one of the top performers in the Dow as well, with shares climbing nearly 17%

Elsewhere, Mead Johnson (NYSE:MJN), the maker of nutritional products for infants, children, and expectant and nursing mothers, rallied 5.8% to $69.08, following an appearance from a company representative on CNBC announcing that its products are safe, even as health officials continue their investigation following the death of an infant. The maker of Enfamil baby formula logged the biggest gain in the S&P 500, rebounding from its sharp loss last week.