Stocks continued to trade at new highs in light trading Wednesday as the closing bell approach despite an absence of fresh economic reports, as investors remained optimistic about the prospects for equities next year.
The Dow Jones Industrial Average rose more than 20 points, after reaching a new 28-month high in the previous session amid half the usual volume on the New York Stock Exchange.
Walt Disney, McDonald's, and Wal-Mart, rose, while Alcoa and Procter & Gamble slipped.
The S&P 500 has marched steadily forward since breaking through a resistance level of 1,255 late last week, and was poised to end its best December since 1991. If the S&P ends up, the broadest market index will have had the fewest down days in a month since at least October 2006, when it fell five days. So far this month, the S&P has fallen just three days.
The Nasdaq also gained, although it was slightly below a new three-year record reached last week. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 17.
Among key S&P 500 sectors, energy, consumer discretionary and materials rose, while financials and utilities fell.
Volume continued to be light so this week, due to holiday vacations in addition to a snow storm in the Northeast. (Read More: Does Light Volume Really Matter?)
The markets have continued to rise all month, with the S&P 500 ending higher for 16 of the last 19 trading sessions. As of the close Tuesday, the Dow rose 5.2 percent for December and 11 percent for the year-to-date. The S&P 500 rose 6.6 percent for the month, and 12.9 percent for the year-to-date. The Nasdaq rose 6.6 percent for December, and 17.4 percent for the year-to-date.
While the tax cut package passed by Congress earlier this month should continue to buoy stocks, investors are showing some hesitance about the future momentum of U.S. stocks as they move into alternative assets—such as futures and commodities—that do not move in tandem with the U.S. equity markets, according to Bob Enck, CEO of Equinox Fund Management, an alternative asset manager.
"The flows into non-correlated assets is telling us there is some caution out there still," Enck said.
Oil closed just above $91 a barrel in light trade, close to their recent 26-month high.
Energy stocks led the market higher, with new 52-week highs seen among oil producers and servicers, such as Chevron, ExxonMobil, ConocoPhillips and Marathon Oil. Exploration and production companies including Murphy Oil,Devon Energy and Apache.
Noble Energy, which also hit a 52-week high, confirmed an offshore property in Israel was the country's largest natural gas find.
Treasury prices rose after the government auctioned $29 billion of 7-year notes,which had a yield of 2.83 percent and a healthy bid-to-cover ratio of 2.86. The succesful auction came as a relief to the Treasury market, which had sold off after after an auction of five-year Treasury notes Tuesday that attracted the lowest demand since June.
The 10-year Treasury note ended the session up 1 3/32 points, pushing the yield to 3.3 percent.
The dollar declined against a basket of currenciesafter the Treasury auction, as the euro stabilized. Copper prices continued to soar, as did gold, which gold closed at $1,413.