Stocks turned negative after trading within a tight range for most of the session Wednesday as continued uncertainties with the global economy weighed on investors.
TheDow Jones Industrial Average fell slightly led by Home Depot and Bank of America . Merck and Travelersrose.
The S&P 500 and the Nasdaq were up slightly. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to just above 22, after reaching a one-and-a-half month high on Tuesday.
Among key S&P sectors consumer discretionary, energy and materials gained, while financials and telecom fell.
Trading on Wednesday was lackluster after the previous session's selloffas investors awaited more information out of Europe and more clarity on the future direction of U.S. tax and regulatory policy out of Washington.
The European Commission, International Monetary Fund and the European Central Bank were sending a team to Ireland Thursday to determine what Ireland would need if were to seek help. The euro rose from a seven-week lowagainst the dollar.
European shares finished higher after declines in the previous session, but concerns over the Irish debt crisis were lingering. Meanwhile, the European Union will deliver its next aid package for Greece on time, said European Union Economic and Monetary Affairs Commissioner Olli Rehn. Austrian Finance Minister Josef Proell had said earlier the aid wouldn't be released until January.
According to Brian Battle, a director at Performance Trust Capital Partners, the market has already baked in good news about earnings and Fed policy, and now, investors need more clarity about Europe, China and the direction Washington will take with Republicans in control of the House, before moving higher.
If Republicans show they are willing to compromise on one of the first orders of business—the Bush-era tax cuts—that would show they are willing to compromise on other tax and regulatory measures and "compromise is bad news for business," Battle said. So far, the message from leaders in Washington is mixed.
"With these mixed signals coming out of Washington, you don’t commit," Battle said. The current environment is "great for trading and good for speculators," but "it's an awful time to be an investor."
More retailers reported strong earnings before the bell this morning, sending shares higher.
Target climbed after the retail giant posted a higher profitand forecast the best same-store sales in three years for the current period covering the key holiday season.
Also, BJ's Wholesale advanced after the retailer's earnings topped forecasts to report a 32 percent jump in earnings on stronger sales.
Chico's rose after reporting stronger-than-expected revenues thanks largely to improved sales for trendier fashions at his White House/Black Market chain for the third quarter.
Limited Brands will report earnings after the close Wednesday, while Sears , Staples and Gamestop are slated to report before-the-bell Thursday.
Gamestop soared after Credit Suisse raised the video game retailer to "outperform" from "neutral."
Baidu , Ctrip and Sina also rose after Stifel Nicolaus began to cover the Internet services companies with "buy" ratings.
In addition, Qualcomm shares jumped more than 3 percent after the tech giant said chip inventory levels are lower than usual, reassuring investors who were worried about the prospects for overstocking of chips in the wireless market.