Stocks turned largely negative in the final minutes of trading, but were on pace to end the year just below record two-year highs with solid double-digit gains for the year amid thin New Year's Eve trading.
The Dow Jones Industrial Average rose a few points, slipping back after topping 11,585, its most recent two-year record. The blue-chip index was on pace to post gains of nearly 11 percent for 2010.
Alcoa , American Express and Verizon rose, while Hewlett Packard and 3M fell.
The S&P 500 and the Nasdaq fell. Among key S&P 500 sectors, telecom, energy and utilities rose, while technology and consumer discretionary fell.
Small cap stocks, meanwhile, have surged this year. The Russell 2000 indexwas trading at break-even levels, but remains on pace to end the year up more than 26 percent.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose to nearly 18.
Volume on the New York Stock Exchange remained light, as it has all week. As of about 3:15 P.M., volume on the consolidated tape was 1.3 billion shares, less than half the usual volume.
Investors hoped to lock in the year's strong gains in the final trading day of 2010. As of the close Thursday, the Dow was up 5.12 percent for December and nearly 11 percent for the year-to-date. The S&P 500 was up 6.5 percent for the month, and 12.8 percent for the year-to-date. The Nasdaq rose 6.6 percent for December, and 17.4 percent for the year-to-date.
The best performing Dow stock for the year through Dec. 23 was Caterpillar , up nearly 66 percent, while the worst was Hewlett-Packard, down nearly 19 percent.
On the S&P 500, the best performer was Netflix , up more than 235 percent, while the worst was Dean Foods . On the Nasdaq 100, the best performer was Baidu , and the worst was Apollo .
Consumer discretionary stocks were on pace to be the best performers of the year, with Netflix leading the sector. Industrials were the second best, with Cummins leading the sector with a 140 percent gain for the year.
Utilities were the worst performers, with FirstEnergy down the most, falling 19.8 percent. (Read more: Top Performing Stocks of 2010.)
Financials rose 10.6 percent for the year, with the biggest gains coming in Decemberas the sector rose 10 percent through Dec. 23.