NEW YORK, Dec 10 (AFP) - Wall Street pulled back the past week in a modest consolidation following recent heady gains, with analysts debating whether the so-called Santa Claus rally would be in play this year.
In the week to Friday, the blue-chip Dow Jones Industrial Average dipped 0.46 percent to 10,543.22 and the broad-market Standard and Poor's 500 shed 0.26 percent to 1,188.00.
The tech-heavy Nasdaq composite meanwhile slipped 0.93 percent for the week to end at 2,128.07.
Following solid gains in November on Wall Street, investors were focused on whether the market could keep momentum in the traditionally strong year-end holiday period that often leads to a so-called Santa Claus rally.
Wall Street's consolidation came amid mixed economic news, including a rise in weekly jobless claims, which was partly offset by the continued decline in oil prices, which ended Friday below 41 dollars a barrel.
Alfred Goldman at AG Edwards said the market has been resilient even in the face of negative news, suggesting the uptrend is intact.
"The market's ability to think that the glass is half full rather than half empty highlights a market that wants to go higher," he said.
"We still have a lot of money on the sidelines and I think that Santa Claus will show up this year -- Scrooge will not."
Art Hogan, market strategist at Jefferies and Co., agreed that the market has held up in the face of news that has been "more negtive than positive."
"So that tells me that fundamentally the market is in pretty good shape," he said. "There's an upward bias and that will continue for the balance of the year."
But Joseph Battipaglia, chief investment officer at Ryan Beck and Co., said there are no natural catalysts coming into the market at this point and believes stocks may already have seen most of this year's gains.
"There are a lot of questions being raised about next year that will keep stocks under wraps at this moment in time, and perhaps we've already seen that Santa Claus rally," Battipaglia said.
Ralph Accampora at Wachovia Securities said the market is subject to various cross-currents.
"Two forces seem to be counter balancing each other over the last week or so," he said. "On one side are those portfolio managers that have made healthy profits ... On the other side of the equation are those market participants that are sitting on cash positions or have under performed their respective performance benchmarks and are watching the year-end clock wind down."
He added, "While this may cause some issues for the market on a short-term basis we have yet see, nor do we think we will, any signs of market activity that would suggest that the up trends for the major equity averages that began in either August or October have run their course. Year-end clouds may be thickening but we continue to see significant further upside price action on the horizon."
Bonds firmed as cautious investors shifted away from stocks.
The yield on the 10-year US Treasury bond dipped to 4.161 percent rom 4.270 percent a week earlier and that on the 30-year bond to 4.822 percent from 4.942 percent. Bond yields and prices move in opposite directions.
12/10/2004 22:38 GMT - AFP