* Many on Wall Street see volatility from budget squabbles
* Applied Materials shares rise on merger with Tokyo
* Facebook leads Nasdaq on report it could be allowed in
* Dow, S&P up 0.1 pct; Nasdaq up 0.3 pct
By Rodrigo Campos
NEW YORK, Sept 24 U.S. stocks were little
changed in choppy trading on Tuesday after data failed to ease
investor concerns about the impact on the economy of stalled
budget negotiations in Washington.
The S&P 500 faced a possible fourth straight day of decline,
but a gain of nearly 5 percent in Facebook shares led the Nasdaq
composite index higher.
Tea Party-backed U.S. senators threatening to stall a bill
to fund the U.S. government ran into a wall of resistance late
Monday from top Senate Republicans, including Minority Leader
The move, however, did not eliminate the possibility of a
shutdown, and signs still pointed to a frantic last-minute
showdown that will determine whether the U.S. government stays
open next week. Republicans want to cancel funding for
"Obamacare," President Barack Obama's healthcare law.
While many on Wall Street expected an eventual government
shutdown to be short and not affect markets deeply, volatility
"Investors have a legitimate cause for near term concern,"
said Jack Ablin, chief investment officer at BMO Private Bank in
U.S. consumer confidence fell in September, dragged down by
consumers' outlook. U.S. single-family home prices rose in July
at a slightly slower pace than forecast, though the gain from a
year ago was the strongest in more than seven years, separate
The data also failed to remove investor uncertainty about
the Fed's intentions about a pullback from its stimulus efforts.
The Fed cited the budget and debt ceiling negotiations in
Washington as a reason to keep its current stimulus intact.
"The stoppage on the fiscal side is going to keep the
monetary flood gates open," said Ablin about the Fed's
quantitative easing. "Investors are looking past the taper."
The Dow Jones industrial average rose 17.4 points or
0.11 percent, to 15,418.78, the S&P 500 gained 1.48
points or 0.09 percent, to 1,703.32 and the Nasdaq Composite
added 12.475 points or 0.33 percent, to 3,777.762.
Facebook shares jumped 4.9 percent to $49.50 after
the South China Morning Post reported the online social media
giant and other websites deemed sensitive and blocked by the
Chinese government will be accessible in a planned free-trade
zone in Shanghai.
Lennar shares led discretionary stocks higher with a
3.7 percent rise to $35.77 after the No. 3 U.S. homebuilder
reported a better-than-expected quarterly profit.
Shares of Applied Materials rose 6.9 percent to
$17.09 after the chipmaker and Tokyo Electron Ltd said
they will merge in an all-stock deal, creating a $29 billion
Red Hat, the world's largest commercial distributor
of the Linux operating system, reported late on Monday a slower
growth in billings than analysts had expected and its shares
fell 11.7 percent to $46.76.