Stocks came off their worst levels but still finished narrowly mixed Tuesday, after a handful of disappointing economic news weighed on the market. Despite the session's lackluster performance, the Dow and S&P are still posted their best January since 1997.
In addition, all three major averages logged their best monthly gains since October.
The Dow Jones Industrial Average declined 20.81 points, or 0.16 percent, to finish at 12632.91, led by ExxonMobil and Alcoa.
The S&P 500 slipped 0.60 points, or 0.05 percent, to end at 1,312.41. The Nasdaq squeezed out a gain of 1.90 points, or 0.07 percent, to close at 2813.84.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, ended near 19.
Among key S&P sectors, financials logged a gain,while energy sagged.
For the month, the Dow rallied 3.4 percent, the S&P 500 jumped 4.36 percent, and the Nasdaq surged 8.01 percent.
Interestingly, the last five times the S&P logged a gain of more than 4 percent in January, the index posted a robust annual average gain of 23 percent. (Read More: What Happens After a Strong January?)
“Overall, we’re looking at a solid month and some type of consolidation makes sense to us,” said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research. “All in all, we’re continuing to talk about Europe…it’s still the wildcard.”
Detrick noted that a stronger market performance in January points to a more bullish year and maintained his 1,450 year-end target on the S&P 500.
On the economic front, home prices fell 1.3 percent last November, according to S&P/Case-Shiller's 20-city composite index, adding to the 0.7 percent drop seen in October. Economists had expected a decline of 0.5 percent.
Consumer confidence posted an unexpected decline in January, dropping to 61.1 from an upwardly revised 64.8 in the previous month, according to the Conference Board. Economists had expected the index to hit 68.0, according to a Reuters survey.